Mobility advocate insists on e-motorcycles' inclusion in tax breaks

MANILA, Philippines — A mobility advocate said it is “unfair” if electric motorcycles were not given tax breaks like other types of electric vehicles

Electric Kick Scooter of the Philippines co-founder Tim Vargas recently expressed concern about two-wheeled electric motorcycles being left out under Executive Order No. 12 series of 2023, which temporarily modifies the tariff rate for electric vehicles and components.

Only kick scooters, self-balancing cycles, bicycles, and pocket motorcycles with auxiliary motors not exceeding 250w and with a maximum speed of 25 km/hour have 0% import duties, while electric motorcycles are still subject to 30% tariff rate.

“It’s very sad that it’s not part of the EO12 and we’re hoping na ma-amend ito o gawan ng panibagong EO para maihabol,” he said in an interview on Tuesday, Feb. 21, 2023.

[“It’s very sad that it’s not part of the EO12 and we’re hoping that it would be amended or a new EO would be passed so we'll make it on time.] 

Upon signing the EO, the tariff ranging from 5% to 30% will be temporarily modified to 0% for the next 5 years to help the country adapt to e-vehicle usage and reduce carbon emissions.

Vargas said that the exclusion of electric motorcycles in the EO12 should be clarified further and revisited by the executive committee.

“I will find it very unfair if hindi nila maayos ‘yon kasi s’yempre we’re in a democratic country so dapat halos lahat mapagbigyan naman,” Vargas added.

[“I will find it very unfair if this won't be fixed especially since we're in a democratic country so almost everyone should be accommodated.] 

He also noted that two-wheeled motorcycles is the primary choice of transport for residents of Metro Manila which should be given priority for incentives.

The Land Transportation Office recorded in 2021 that almost 8 million units of motorcycles were registered to their office.

EV industry emerging

Vargas believes that the large usage of two-wheeled motorcycles along with the e-vehicle industry can also help improve the country's employment rate.

“I’m pretty sure that it’s gonna create a different market,” he said.

The push for using EVs from other stakeholders also stems from the Philippines as the third of the most vulnerable country to climate change and is set to lose 6% of its gross domestic product annually by 2100.

In a study conducted by American business consulting firm “Frost and Sullivan” in 2018, a total of 93% of surveyed Filipinos said that they are open to buying electric vehicles in the future.

The Electric Vehicles Association of the Philippines projected the EV market to grow at an annual rate of 8% to 12% over the next 10 years.

This equates to about P1.68 billion in revenue services and sales of 200,000 units by 2024.

According to Industry.gov.ph, a portal for the economic sector under the Department of Trade and Industry, there are 28 firms currently engaged in the manufacturing of electric vehicles in the country.

This provides jobs to around 14,840 in industries involving parts and components manufacturing and importation.