CAMPI lobbies to retain excise tax exemption on pickup truck category

THE Chamber of Automotive Manufacturers of the Philippines, Inc. (CAMPI) said it will ask legislators not to remove the excise tax exemption for pickup trucks, expressing fears that the resulting price hikes on a significant vehicle segment will blunt the industry’s recovery.

“We will seek opportunities to present and discuss our position with concerned legislators and appropriate government agencies,” CAMPI President Rommel R. Gutierrez said in a mobile phone message when asked to comment on the proposed removal of the exemption.

Separately, Mr. Gutierrez said on the sidelines of a news conference in Parañaque City on Tuesday that pickup trucks account for 17% of the industry’s vehicle sales. 

“That is how big it is. Many are using pickups, since these are for business,” Mr. Gutierrez said, referring to the vehicle’s role as a farm, construction, or delivery vehicle. Many pickups, however, are employed as personal transport.

“We are concerned about the addition of the taxes. As we know, the demand for vehicles is price-sensitive. This will definitely impact prices,” Mr. Gutierrez said.

“We are still recovering. We have not yet recovered fully to pre-pandemic levels. We express concern,” he added.

Mr. Gutierrez urged the government to consider the auto industry’s condition in tax policy, saying that the two sides are partners in the economy.

“It’s really a collaboration between the government and private sector. We want to strike a balance (between) the government’s intention (to tax) and the situation of the auto industry. We will definitely discuss, at least ask for discussions… in resolving this issue,” Mr. Gutierrez said.

“We will follow the process in Congress. They have public consultations or committee hearings on the issue. We will go there upon invitation. We will submit, as needed, the collective position of all the members,” he added.

The House Ways and Means Committee approved last week the fourth package of the Comprehensive Tax Reform Program which included the elimination of the excise tax exemption on pickup trucks.

The fourth package was previously called the Passive Income and Financial Intermediary Taxation.

The removal of the excise tax exemption is expected to generate P52.6 billion worth of additional revenues from 2022 to 2026, according to the Finance department.

Pickup trucks are exempted from excise tax under Republic Act No. 10963 or the Tax Reform for Acceleration and Inclusion. The exemptions are targeted at small business owners and professionals who use the trucks for work.  

CAMPI and the Truck Manufacturers Association, Inc. estimate that vehicle sales increased 18.4% to 182,687 units in the seven months to July.

Commercial vehicles, including pickup trucks, accounted for 75.18% of the total, or 137,338 units.

CAMPI has set a sales target of 336,000 units this year, up 17%.

Separately, CAMPI announced that it will stage the 8th Philippine International Motor Show (PIMS) between Sept. 15 and 18 at the World Trade Center in Pasay City.

PIMS returns after a four-year hiatus, with exhibitors including BMW, Chery, Foton, Geely, Honda, Hyundai, Isuzu, Kia, Mazda, Mitsubishi, Nissan, Suzuki, and Toyota.

At the motor show, “We will… come together to showcase the positive impact of sustainable and future-ready innovations on our day-to-day lives,” Mr. Gutierrez said. — Revin Mikhael D. Ochave

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