DTI drafting EO for EV manufacturers’ tax incentives


The Department of Trade and Industry (DTI) is drafting its zero-tariff policy for the importation of electric vehicles (EVs), which it hopes to have Pres. Rodrigo Duterte sign before stepping down on June 30.

Trade Sec. Ramon Lopez said that Duterte himself has agreed to lower EV import tariffs to 0% from 30%. The proposal, which the DTI first floated in March, is currently being heard by the Tariff Commission.

The drafting of the executive order for zero-tariffs on EVs follows the enactment of Republic Act (RA) 11697 or the Electric Vehicle Industry Development Act two weeks ago

RA 11697 pushes for “the manufacture, assembly, importation, construction, installation, maintenance, trade and utilization, research and development, and regulation of [EVs].” The new law also provides for the development of EV charging stations, which Lopez says costs Php1-2 million each.

Lopez added that the DTI is also considering the allocation of fiscal support for the Board of Investments’ Php27 billion Comprehensive Automotive Resurgence Strategy (CARS) program. Under the incentive package, three car manufacturers would receive a maximum of Php9 billion in government support given they could produce 200,000 units of their enrolled car model within six years. 

Toyota Motors Philippines Corporation and Mitsubishi Motors Philippines Corporation have expressed their interest to participate. Toyota enrolled the Vios compact car, while Mitsubishi has its competing Mirage. The DTI is looking for a third player  under the CARS program.

The EV manufacturing industry is now listed in the government’s Strategic Investment Priority Plan, meaning that the manufacturers can avail of fiscal incentives of four to seven years of income tax holiday and even a special corporate income tax. Lopez said that these tax incentives will encourage the infrastructure of EVs and the development of vehicles. 

Energy Sec. Alfonso Cusi welcomed the passage of RA 11697. which also states that the Department of Energy would lead the technical working group for the rollout of EVs in the country.

“We recognize that this law will allow us to transition to a clean energy scenario, and the support from all our stakeholders is needed so we may achieve a more efficient transportation system. We will be working closely with other government agencies and our stakeholders in the speedy development and issuance of the implementing rules and regulations to the law,” Cusi said in a statement.

Under the law, the Department of Energy would lead the technical working group for the rollout of EVs in the country.

Re-electionist Sen. Sherwin Gatchalian also welcomed the law’s passage. Gatchalian, chairman of the Senate Committee on Energy, is the principal author and sponsor of RA 11697 in the upper chamber of Congress.

“The local production of EVs, which some industry players already initiated ahead of this new law, will not only increase the uptake of EVs but likewise pave the way for the generation of new jobs and reduce the transportation sector’s reliance on imported fuel,” he said.

Meanwhile, SM Supermalls has launched free EV charging stations in four of its malls – SM Aura in Fort Bonifacio, Taguig City, SM Megamall in Mandaluyong City, SM Mall of Asia in Pasay City, and SM North EDSA in Quezon City – to help encourage Filipinos to switch from traditional cars to EVs.