AutoIndustriya.com / AutoIndustriya.com | December 12, 2017 10:24
Congress, Senate expected to ratify new excise tax measures today
The bicameral conference committee composed of congressmen and senators have concluded their discussions on disagreeing provisions of House Bill 5636 and Senate Bill 1592; both titled the 'Tax Reform for Acceleration and Inclusion (TRAIN)'.
The special committee is composed of Representatives Dakila Cua, Miro Quimbo, Sharon Garin, Gus Tamunting, and Aurelio Gonzels; representing the Senate are Sonny Angara, Koko Pimentel, Migz Zubiri, Loren Legarda, and Ralph Recto. DOF Assistant Secretary Karl Kendrick Chua was also at the session.
After the bicameral conference between the two houses and with members of the executive branch in attendance, the committee has agreed on the new tax system for automobiles, one that features a new 4-tier scheme as opposed to the Congress version with 5 tiers and the Senate version with 2.
The new 4-tier automotive excise tax scheme* will be as follows:
4% - up to PhP 600,000
10% - PhP 600,000 over up to PhP 1,000,000
20% - over PhP 1,000,000 up to PhP 4,000,000
50% - over PhP 4,000,000
Interestingly enough, the version that was agreed upon at the bicameral conference places specific exemptions on electric vehicles (EVs), while hybrids (vehicles that use a combination of internal combustion and electric power) will only be levied half the new standard excise tax rate. Pick-up trucks will also be exempt from excise tax.
The bicameral version also states the new excise tax schedule for fuels*:
Gasoline - PhP 7.00
Diesel - PhP 2.50
Kerosene - PhP 3.00
Auto LPG - PhP 2.50
The new TRAIN bill also imposes additional excise taxes on mining, coal, and sugar-sweetened beverages. TRAIN will, however, increase take-home pay for many Filipino workers through a new income tax schedule with those that earn PhP 250,000 and below a year being exempted from income tax. Bonuses up to PhP 90,000 will be exempted as well.*General figures, specifics expected to be released once bill is ratified
Please note that the above figures are not final as the bill has to be ratified by both branches of congress and submitted to the president to be signed into law within the week. The new tax reform law is expected to be implemented by January 1, 2018.
Senate president Koko Pimentel has reassured that his branch will be working overtime to ratify the TRAIN bill "no matter the time".