Proposed tax to raise prices of new vehicle costing 1.2 million pesos
Buy a new car now before Congress passes a new law imposing 40 percent ad valorem tax, which means paying P480,000 for every vehicle whose price is P1.2 million, a congressman said..
In a press conference Monday, Quirino Rep. Dax Cua, chairman of the ways and means committee, said his panel is deliberating on the proposal the finance department included in the tax reform package.
“That is a part of our reaction to traffic crisis. If this will be passed, better to purchase a vehicle before Congress passes [a law on it],” Cua told reporters.
“I am supportive of the measure, but the amount of tax to be imposed under the proposal is too much. There should be an adjustment,” Camarines Sur Rep. Rolando Andaya Jr said.
The bill said there shall be a levied, assessed and collected an ad valorem tax on automobiles based on manufacturer's or importer's selling price, net of excise and value added tax (VAT).
Under the measure, if the net manufacturer's price or importer's selling price is P600,000 the excise tax will be five percent.
If the net manufacturer's price or importer's selling price is P600,000 to P1.1 million the excise will be 20 percent of net manufacturing or importation price.
If the net manufacturer's price/importer's selling price is P1.1 million to P2.1 million the excise will be 40 percent of net manufacturing or importation price.
If the net manufacturer's price or importer's selling price is P2.1 million the excise will be 60 percent of net manufacturing or importation price. DMS
