Senate finds ways to impose ‘fair’ excise tax on vehicles

Senator Juan Edgardo “Sonny” Angara. INQUIRER.net / FILE PHOTO

How about imposing higher taxes on the third or fourth car that would be registered under the same name?

This was one option that Senator Sonny Angara, chair of the Senate committee on ways and means, would like the Department of Finance (DOF) to study.

“To free up road space, we will look into imposing higher taxes doon sa pangatlo o pang-apat na sasakyan na bibilhin nila (on the third or fourth vehicle that they will buy) through the motor vehicle user’s charge (MVUC),” Angara said in a statement on Friday.

Asked to elaborate on his statement, the senator said in a text message that they asked the DOF “to consider looking into other things like registration of 3rd and 4th cars and to charge them more so it would be fairer.”

The House of Representatives has already passed the proposed comprehensive tax reform package that included higher taxes on automobiles. Angara’s committee, however, is still deliberating on the same measure.

READ: House passes tax reform package

The measure seeks to lower income taxes while limiting value added tax (VAT) exemptions and adjusting excise taxes on oil and automobiles.

“I think raising the auto excise (tax) is a good strategy but the government should provide the public an efficient, dependable, safe and affordable public transport system to encourage the people to take mass transit rather than use their own cars,” Angara said.

“I am one with the goal of making public transport the preferred mode of travel. Pero sana madaliin din ang pag-ayos ng (but please hurry with the maintenance repair of) MRT at LRT to help migrate the ones bringing cars to public transport,” he added.

The senator noted that under the proposed adjustment of excise tax on automobiles, mass-market vehicles such as the base model Toyota Vios would increase by P10,000, Mitsubishi Mirage by P13,000, Toyota Innova by P43,000, while SUVs such as Toyota Land Cruiser will increase by as much as P950,000.

“The Lower House was able to temper down the original proposal of the Finance Department to ensure that most cars, especially low-end models, will remain affordable,” Angara said. JPV

RELATED STORY

Campi: Higher excise tax on vehicles ‘sending wrong signal’ to automotive investors