The price of electric vehicles will go down by a third if the government grants fiscal incentives to the fledgling industry producing these transport products, the association of local manufacturers of electric vehicles said.
The Electric Vehicle Association of the Philippines (EVAP) pressed its plea for government incentives, saying these would result not only in a 30 percent reduction in the price of these vehicles but help reinvigorate the motor vehicle parts industry – which employs 50,000 people – now operating at just half of capacity.
Electric vehicles have caught the attention not only of certain local government executives especially in Metro Manila but also of the Asian Development Bank because of their environmentally-friendly features and the prospect they present of significantly reducing the country’s dependence on and imports of expensive petroleum products.
The city of Makati first introduced electric jeepneys, and Mandaluyong and Taguig now have operational electric tricycles or e-trikes, which run completely on electricity. Quezon City is reportedly contemplating enforcing the shift of gasoline-powered tricycles, which are the backbone of the public transport system in its barangays and local communities, to e-trikes.
The early generation of e-trikes have conventional car batteries to store their electric charge, but the new ones manufactured with financing from the ADB have ion-lithium batteries.
EVAP seeks higher duties for EVs that are imported completely built-up, pointing out that the imports do not encourage the use of locally-produced parts.
In a position paper sent to Tariff Commission chairman Edgardo Abon, EVAP reiterated the association’s contention that the duty on imported EVs must be 30 per cent of their value if they come in completely built-up (CBU).
The group also argued strongly that parts and components available locally be used in the assembly and manufacture of EVs. If these components are not available locally, imports of foreign equivalents must be allowed in at zero percent duty, the association added.
EVAP also urged zero percent import duties for capital equipment and spare parts for EV manufacturing and assembly, as well as for raw materials not available locally.
EVAP supports House Bill No. 5460 which has been approved, and Senate Bill No. 2856 which is still pending. HB 5460 provides various incentives such as exemption for EV manufacturers and assemblers from payment of excise tax and duties for nine years, VAT (value-added tax) exemption for the importation of raw materials, spare parts, components and capital equipment for nine years and zero percent VAT rate for the sale of raw materials, spare parts, components and capital equipment also for nine years.
For EV importers, the House bill provides for exemption from payment of excise taxes and duties for four years.
SB 2856 authored by Sen. Ralph Recto provides for the same perks.
“We hope the Senate approves the pending bill so as to help re-energize the domestic auto parts making industry where member companies are operating at below 50 per cent of their rated plant capacities and on which some 50,000 employees are dependent,” EVAP said in a press statement.
