MANILA – President Ferdinand R. Marcos Jr. is expected to sign an executive order (EO) that will cut tariff rates on imported electric vehicles (EV) and EV parts and components soon, Socioeconomic Planning Secretary Arsenio Balisacan said.
In a Palace briefing Thursday, Balisacan said the National Economic and Development Authority (NEDA) Board has endorsed to Marcos the EO modifying tariffs of EVs, including passenger cars, buses, mini-buses, vans, trucks, motorcycles, tricycles, scooters, and bicycles, among others, to zero.
However, he said the tariff reduction would only be imposed on completely built-up unit (CBU) EVs, with an exemption for hybrid-type EVs.
Balisacan said the EO would also slash tariffs for EV parts and components from the current 5 percent to 1 percent.
The tariff modification will be implemented for five years.
“The EO aims to expand market sources and encourage consumers to consider acquiring EVs, improve energy security by reducing dependence on imported fuel, and promote the growth of the domestic EV industry ecosystem,” he added.
EVs coming from the Association of Southeast Asian Nations (ASEAN) are already at zero tariff as the country has free trade agreement with other Southeast Asian countries, but the most favored nation (MFN) tariff for EVs remains high at 30 percent.
This reform would benefit EVs imported from big suppliers of e-vehicles such as China, Japan, and South Korea.
“We will review the effects of this new policy after one year and we’ll see how we reconfigure the system by then,” Balisacan said.
He said the issuance of the EO would open up the market for more EVs, and the growth of auxiliary services, like charging stations, are expected to follow suit.
“As of now, the quantity of those vehicles is not that big, but because we want to encourage the adoption of EVs, that will eventually increase the demand for support systems, like the chargers. It can even develop value-adding services for our industry,” he added.
A commissioned study by Frost & Sullivan in 2021 showed that the Philippines is one of the countries in Southeast Asia with high readiness in adopting e-vehicles.
The study also showed that the significant lowering of barriers has encouraged ASEAN consumers to purchase electric cars.
Concerns of interested EV buyers in the region are mainly infrastructure-related, including the availability of charging stations.
Last month, Ayala Land, Inc. said it would launch at least 20 e-vehicle charging stations across Luzon, which will be present in strategic locations such as malls, offices, estates, hotels, and industrial zones owned by the company. (PNA)