House approves bill on tax breaks for e-cars

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[/caption] House Bill 5460 proposes perks such as exemptions from excise, import, and value-added taxes, with the hope that these will bring down showroom prices and make the environment-friendly vehicles more accessible to Filipinos. “We have to encourage the use of environment-friendly vehicles. If you bring down the cost of importation and manufacturing, you lower the prices and more people can afford to buy them,” Batangas Rep. Hermilando Mandanas, one of the authors of the bill, said. Mandanas said the bill aims to lay down the groundwork for the widespread use of electric, hybrid, and other alternative-fuel vehicles to help protect the environment by mitigating the effects of harmful emission into the atmosphere. A hybrid vehicle, as defined under the bill, is one that combines the technologies of using internal combustion engine (Ice) with a battery-powered electric motor to gain advantages of both propulsion systems. An electric car, on the other hand, is a vehicle that uses electric motors solely for propulsion while an alternative fuel vehicle pertains to any vehicle using alternative sources or energy as described in the measure. These alternative sources of energy include but are not limited to solar, wind, hydrogen fuel cell, compressed natural gas (CNG) or liquefied natural gas (LNG) and liquefied petroleum gas (LPG) other than conventional sources of energy like petroleum and gasoline for propulsion. Under the bill, incentives are given in the form of exemption from payment of excise taxes and duties for nine years from the effectivity of the law for the manufacture or assembly of completely knocked-down (CKD) parts, as well as the importation of raw materials, spare parts, components and capital equipment used in the manufacture or assembly of electric, hybrid and other alternative fuel vehicles including the conversion into such vehicles. A zero percent VAT rate shall also be implemented during the same 9-year period. ]]>

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