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Thursday, February 22, 2024

Zero tariffs on 2-wheeled EVs seen after EO review

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THE Department of Trade and Industry (DTI) is hoping the Tariff Commission will decide to impose zero tariffs on imported e-motorcycles on February 2024, a year after the implementation of Executive Order (EO) 12.

Trade Secretary Alfredo E. Pascual said he is in favor of modifying the tariff rates for imported electric motorcycles (e-motorcycles) to zero. However, he noted that the Tariff Commission shall determine the course of the proceedings regarding the adjustment of duties of items included in EO 12 (series of 2023).

โ€œIt is there in the EO; [our] decision to apply it to 4-wheeled vehicles, both cars and transport vehicles. It is good for five years,โ€ Pascual said.

The Trade chief, nonetheless, noted thereโ€™s a provision in the said measure regarding 2-wheeled vehicles such as e-motorcycles that was excluded by the EO. Hence, these are still subject to 30-percent tariff rate.

The Trade chief stressed that the review of items to be subjected to zero-tariffs is set to transpire sometime in February 2024, a year after the EO 12 was implemented.

Pascual said thereโ€™s a provision in the EO that may change the tariff rates.

โ€œ[We have a] provision [there]. โ€™Yung mga hindi sinama ngayon like โ€™yung two-wheeled vehicles like motorcycles, we will review the EO after one year to see whether there is a stronger justification to include these,โ€ the DTI chief said. โ€œThey [advocates for inclusion of 2-wheeled EVs] can build their case. Doon na lang natin sundan kapag dumating na โ€™yung one-year review.โ€

Pascual added that some local manufacturers of electric bicycles oppose the modification of tariffs of 2-wheeled vehicles to zero rate.

Last Tuesday, industry group Electric Vehicle Association of the Philippines (EVAP) announced backing the removal of import duties for two-wheeled vehicles, saying the move would make electric vehicles (EVs) more affordable and help the country achieve its goal of reducing greenhouse-gas emissions.

EVAPโ€™s statement issued last Tuesday read that its advocacy has always been zero-tariff for all EVs, especially 2-wheeled vehicles. The group, however, excludes e-Jeeps and e-Trikes as EVAP said these have local manufacturing and assembly.

Under the motorcycles classification in the EO 12, only kick scooters, self-balancing cycles, pocket motorcycles and bicycles with auxiliary motors not exceeding 250 watts and with a maximum speed of 25 kilometers per hour have zero import duties while electric motorcycles are still subject to a 30-percent tariff rate.

Meanwhile, Consumer Advocate Louie C. Montemar said the EO 12 is discriminatory and should be amended so that tax breaks given to owners of EVs could be enjoyed by Filipinos from the working class. (See https://businessmirror.com.ph/2023/02/16/palace-urged-to-widen-scope-of-eo-on-ev-tax-incentives/)

โ€œThe EO is discriminatory because it covers only 4-wheeled vehicles. It does not cover the majority of the working class, many of whom use 2-wheeled and 3-wheeled vehicles, or even public utility jeepneys,โ€ Montemar, co-convenor of Bantay Konsyumer, Kalsada, Kuryente, has said.

Image credits: Walter Eric Sy | Dreamstime.com

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