House panel eyes higher Motor Vehicle User’s Charge, exemption for motorcycles
MANILA, Philippines — The House tax panel is set to hear proposals to update Motor Vehicle User’s Charge rates when session resumes after the second State of the Nation Address of President Ferdinand "Bongbong" Marcos Jr., this before it tackles the proposed additional taxes on salty and sugary food.
According to House Ways and Means Chair Joey Salceda (Albay, 2nd district), the measure was sought due to heavier traffic brought about "artificially cheaper" vehicles. This, he says, has lead to more traffic than Philippine roads could accomodate.
"[There are] already four proposals pending the Committee for updating MVUC rates," said Salceda in a statement last Tuesday.
"We are considering a set of other options, including placing MVUC in the Tax Code, since the Road Board, which used to administer it, no longer exists anyway."
One of the four measures, House Bill 376, was filed by Salceda himself.
The Japan International Cooperation Agency (JICA) in 2017 estimates the cost of traffic in Greater Manila Area to be P1.227 trillion alone. It's likely that the figures have already grown, according to the lawmaker.
The National Government reportedly spends around P300 billion on road construction and repair every year. The MVUC accounts for over P18 billion a year, prompting the solon to content that car owners are heavily subsidized for car use.
In Southeast Asia, countries like Singapore and Vietnam are known to impose higher taxes on private car ownership besides requiring additional documents like certificates of entitlement.
Private cars take up more space on the road that vehicles like trains and buses, especially for cars that only carry one passenger.
"Only 5.9 percent of all Filipino households own any type of car, jeep, or van. Meanwhile, half of Filipino households own some sort of motorcycle," added Salceda.
"My proposal is to exempt motorcycles from MVUC. Especially since it’s a means of living now, with delivery express services and the like. Tricycles will also be exempt under my proposal."
Zero-interest loans for jeepney manufacturers
The lawmaker is also thinking of earmarking some revenues for zero-interest loans for local jeepney manufactuers, since imported modern ones are expensive.
The success of locally made public utility vehicles, he says, will drive up local employment.
Proposals like the motor vehicle tax and proposed luxury goods tax, which Marcos already gave support to, will be tackled before the controversial tax on "junk food."
Consumer groups have earlier lambasted the proposed higher taxes for salty and sweet foods since many Filipinos rely on instant noodles and canned goods to get by, arguing that making healthier food options more affordable should be prioritized. — with reports from Cristina Chi
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