Higher tax continues to dampen demand for cars

AUTOMOBILE SALES fell for the third straight month in March as a higher tax rate that came into force in January continued to dampen demand, industry groups reported on Thursday.

A joint report of the Chamber of Automotive Manufacturers of the Philippines, Inc. ( CAMPI) and Truck Manufacturers Association showed that member companies sold 28,216 units last month, down 22.8% from the 36,561 in March 2017 and 7.8% from February’s 26,176 units.

The first three months saw industry sales drop 8.5% to 86,037 from 94,026 a year ago.

“The decline in sales in the first quarter of 2018 is not unexpected,” Rommel R. Gutierrez, president of CAMPI and a first vice-president at Toyota Motor Philippines Corp., said in an emailed statement.

“The impact of the change in excise tax rates under the TRAIN law was anticipated for this particular period,” he said, referring to Republic Act No. 10963 or the Tax Reform for Acceleration and Inclusion law that raised tax rates for automobiles, fuel, minerals and other products in order to more than make up for a cut in personal income tax rates, starting Jan. 1.

March alone saw Toyota Motor topping other sellers with 11,406 units that accounted for 40.42% of the total, down 15.7% from a year ago; followed by Mitsubishi Motors Philippines Corp. with 6,734 that contributed 23.87% to the total, down 1.3%; and Ford Motor Company Phils. Inc.’s 1,851 (6.56%), down 50.7%. —