The Department of Trade and Industry and the Department of Finance have agreed to maintain the exemption for all Asian Utility Vehicles (AUVs) from excise tax payments to support the development of affordable, decent and highly localized multipurpose vehicle.
Trade and Industry Secretary Manuel A. Roxas II said this amid clamor from the AUV manufacturers against move from the Finance side and the Board of Investments (BOI) to subject AUVs from excise tax.
Roxas said the agreement came after determining there is only a small tax generation from the high-end AUVs.
Previously, the DoF agreed to continue excise tax exemption on the basic AUV model but not on the high-end or the fully dressed-up AUVs.
But based on estimates, Roxas said the government can only generate below P20 million from the highend AUVs which means that the bulk of AUV sales are on the basic model.
At present, the AUVs account for 40 percent of total vehicle sales. Total vehicle sales last year reach over 80,000 units.
Earlier, the DOF said its move was meant to plug this tax loophole in. Its previous estimates have placed excise tax collectibles from AUV manufacturers, for all its models, to amount P17 billion.
Roxas, however, said he favored the revision of excise taxation on motor vehicles to valuebased from the present engine size.
At present, vehicles are slapped with excise tax ranging from 15, 35, 50 and 100 percent based on engine …