Marcos E.O. on import duties will help EV industry flourish -- EVAP head Araga

A win for electric vehicle (EV) owners, buyers and sellers.

That is how Electric Vehicle Association of the Philippines (EVAP) president Edmund Araga described the executive order (E.O.) signed by President Ferdinand Marcos Jr. on Jan. 13, 2023.

“Finally, our EV industry will totally roll out in line with Executive Order No. 12 of PBBM as it opens a very good opportunity for those interested EV enthusiasts and advocates to own one,” he told AutoFun Philippines.

“Consumers will experience a wide array of models to choose from, depending on their preferences,” Araga added.

E.O. No. 12 implements the temporary lifting of specific import duties, particularly granting zero percent Most-Favored Nation or MFN Rate of Duty tariffs on various battery EVs until 2028. It does not include hybrid EVs.

The measure will likely reduce the price of battery EVs in the coming months. The government is aiming to sell only brand-new EVs locally by 2040.

The order takes effect 30 days after its publication in the Official Gazette. The Palace released a copy of the E.O. on January 19, 2023.

However, the Bureau of Customs still has to promulgate Implementing Rules and Regulations for the order to be enforced.

The cleanest choice

Araga said the E.O. also bolsters the provisions of Republic Act 11697 or the “Electric Vehicle Industry Development Act.”

“As we all know, we all rely on the importation of EVs for personal mobility, which is far better than owning an internal-combustion engine or even a hybrid,” he said.

The highly awaited E.O. is the latest in a string of incentives that the government is rolling out to promote EV use in the Philippines.

Under the Tax Reform for Acceleration and Inclusion Law, or TRAIN Law, the government already provides excise-tax exemptions for battery EVs. It also imposes 50 percent of the excise tax rate for hybrid EVs.

An excise tax, according to the Bureau of Internal Revenue, is a tax “imposed on the production, sale or consumption of a commodity in a country.”

Meanwhile, R.A. 11697 offers various non-fiscal incentives for EV owners until April 2030. These include:

• Exemptions from number-coding schemes implemented by the Metropolitan Manila Development Authority and local government units. 

• Priority at the Land Transportation Office (LTO) for all their registration concerns

• A 30-percent discount for battery EVs and a 15-percent discount for hybrid EVs for the LTO motor vehicle user's charge, vehicle registration, and inspection fees

Araga told AutoFun Philippines on November 2022 that the government is working on other fiscal incentives for people who buy an EV.

Are you looking forward to cheaper EVs in 2023?