Philippines: Zero tariff on e-vehicles seen taking shape this year

MANILA, Philippines — The government expects to release its policy on zero tariffs on electric vehicle (EVs) imports by the end of this year, according to an  official of the Department of Energy (DOE).

In a pre-event press conference for the 10th Philippine Electric Vehicle Summit (PEVS), DOE director Patrick Aquino affirmed that there are moves by the government to bring the ad valorem tariffs of EVs to zero.

Aquino said the proposal is pending with the Committee on Tariffs and Related Matters (CTRM).

“Based on our understanding we are just waiting for the settling of the new officials. The zero ad valorem (tariff) is expected to be released within the year,”Aquino said.

“So you can expect that zero ad valorem from 30 percent or five percent irrespective of country of origin to zero, hopefully before the end of the year,”he said.

Aquino said the proposed zero ad valorem tariff is seen to last for five to seven years.

During the hearing conducted by the Tariff Commission in May, the Department of Trade and Industry (DTI)-Board of Investments chief investment specialist Reynaldo Lignes said the DTI wants to remove the tariff on EVs, regardless if it originated from most favoured nations (MFN) or a free trade agreement partner country, for a period of five years.

“This is envisioned to drive down the purchase price of EVs, thereby generating demand and encouraging investments in charging stations and most importantly, to reduce the country’s vulnerability to heavy dependence on oil imports,” he said.

Aquino said such a measure is seen to encourage consumers to consider EVs as a cleaner and greener transportation option.

“Furthermore, a vibrant domestic demand based on EVs could also potentially promote a host of local investments in parts manufacturing, battery manufacturing, mining and electronics industry, as well as building up a pool of human resource capabilities on EV technology,” he said.

He said the agency aims to promote local manufacturing of EVs and turn the Philippines into a regional production hub for such vehicles.

The proposed temporary removal of MFN on EVs covers battery EVs, hybrid EVs, light EVs (scooters, bicycles), and plug-in EVs, as well as parts and components such as lithium-ion accumulators, motor controllers, and AC charging stations.

In July, Trade Secretary Alfredo Pascual shared that the TC recommended eliminating tariffs on electric vehicles.

“Approval of this recommendation will put Italian evehicle makers on a level-playing field alongside our free trade agreement partners,”Pascual said earlier during the high-level dialogue on ASEAN-Italy Economic Relations in July.

“We are opening our EV market to help develop an ecosystem for a viable market that can support the production of electric vehicles in the Philippines,”he said.

Source: https://www.philstar.com/business/2022/09/30/2213159/zero-tariff-e-vehicles-seen-taking-shape-year