Import tariff removal on all electric vehicles gains DTI backing

MANILA – Department of Trade and Industry (DTI) Secretary Alfredo Pascual said that the agency supports temporary removal of import tariffs for electric vehicles (EVs) for a period of five years. 

In a statement, Pascual said that the agency initially proposed the tariff removal on EVs regardless of origin to help drive down the prices and entice Filipinos to shift to EVs. 

"DTI proposed the temporary removal of tariff on EVs for a period of five years...[the agency] believes that the measure will help develop the local EV market and encourage consumers to consider shifting to EVs for a cleaner and greener transportation option," Pascual said in a statement.

"The temporary elimination of tariffs is seen to drive down the purchase of EVs, thereby generating increased demand and encouraging investments in EV charging stations," he added.

However, DTI’s proposal was met with opposition. 

According to Pascual, the Electric Vehicles Association of the Philippines (EVAP) and the Motorcycle Development Program Participants Association (MDPPA) requested for the exclusion of e-motorcycles during the Tariff Commission's public hearing last May 12. 

Several stakeholders of the e-motorcycle and vehicle market saw this move as “unjustified” as motorcycles hold the majority among motorists in the country with around 2.27 new registrations, according to Statista.com.

The Philippine government in January released Executive Order No. 12 series of 2023, which modifies the tariff rates for certain EVs and its components to 0%, with the exclusion of e-motorcycles, which are still subject to 30% tariff rate. 

An increasing clamor for inclusivity in the coverage of EO12 has since followed its issuance. 

Think-tank Stratbase ADR Institute President Dindo Manhit believes that EO 12 should be revised to include e-motorcycles in the tax break as it is 'discriminatory' and rich-favored.

On February 21, 2024, EO12 shall be subject to review by the National Economic and Development Authority wherein recommendations for possible amendment shall be submitted for approval of the President.