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Business

Automakers oppose Marcos' plan to remove tax exemption on pick-ups

Ramon Royandoyan - Philstar.com
Automakers oppose Marcos' plan to remove tax exemption on pick-ups
President Ferdinand "Bongbong" Marcos Jr. answers question directed to him by the members of the Palace media during a press briefing at the Heroes Hall in Malacañang, Tuesday, July 5, 2022.
PCOO / Robinson Niñal

MANILA, Philippines — Local car manufacturers opposed the Marcos Jr. administration's plan to repeal the excise tax exemption on pick-up trucks, saying such a move could impact vehicle sales.

In a statement sent on Friday, the Chamber of Automotive Manufacturers of the Philippines Inc. said the proposal could not only impact sales but also affect government revenues. Finance chief Benjamin Diokno floated the proposal to Congress lawmakers this week as part of its fiscal consolidation plan.

"CAMPI strongly objects to the proposal to remove excise tax exemption of pick-up trucks, a major component of the commercial vehicle segment. Such imposition will negatively impact its sales volume thereby reducing revenues to the government," said CAMPI president Rommel Gutierrez.

CAMPI data revealed they missed their sales target in 2021. Vehicle sales are often used as barometers of economic strength since the sales of these durable goods are measures of consumer appetite.

"Any new tax on motor vehicles will certainly derail the recovery efforts of the automotive industry which is yet to achieve pre-pandemic level of sales volume," Gutierrez added.

Diokno took on the proposal, which was part of the Duterte administration's fiscal consolidation plan, since they reasoned that these pick-up trucks were repurposed to serve as passenger or sports utility vehicles.

The special tax treatment for pick-up trucks was granted by the Republic Act 10963 or the Tax Reform for Acceleration and Inclusion (TRAIN) law, the first package of a Duterte-era tax reform program.

PHILIPPINE ECONOMY

PICK-UP TRUCK

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