The new regulations proposed to remove the tax exemption of practically all commercial vehicles, AUVs and SUVs, except passenger vans. They also require local AUV manufacturers to follow the much stricter seat measurement set by the BIR way back in 1997.
Honda Cars Philippines Inc. sought the TRO against the Department of Finance and the BIR.
HCPI assistant vice president Alfredo Magpayo said the request for a TRO was made "just in case there is no new excise tax law."
Industry sources said the new revenue regulations are supposed to take effect by the end of this month, but actual implementation is not expected until after the existing inventory of automotive vehicles as of Feb. 15 is exhausted.
Earlier, the government agreed to defer the implementation of RR 4-2003 to March 31 instead of Feb. 16 to allow the car industry and the government to push for the early passage of a legislative measure before Congress goes on recess on March 21 with the new law likely to take effect by June this year or after assemblers shall have exhausted their inventory as of the date of approval of the bill.
Under the pending measure, the excise tax on automobiles will be computed based on the vehicles’ value and not their seating capacity.
From an excise tax schedule of 15, 35, 50 and 100 percent for automobiles not covered by the exemption, the new tax rates of 3,15, 30 and 50 percent would be based on the price instead of engine displacement and fuel type.
Under the proposed set-up, vehicles worth P500,000 and below would be taxed three percent, those worth P500,000 to P1 million would be slapped 15 percent. A 30-percent rate would be charged on those worth more than P1 million but below P2 million and vehicles worth P2 million and above would have to pay a 50-percent tax. The exemption of AUVs would be lifted.