The heyday of relatively affordable leisure and lifestyle pickup trucks may soon be over as Senate Bill 2865 or the Capital Markets Efficiency Promotion Act (CMEPA) might be signed into law as early as June according to industry sources.
Considered by the government as a priority bill, both houses of Congress—the Senate and the House of Representatives—may present the bill to President Ferdinand “Bongbong” Marcos Jr. for his approval after the midterm elections this May 2025.
Unless vetoed, it will become law after 30 days. After which, implementing rules and regulations can be imposed by the Bureau of Internal Revenue. This could happen as early as June with the implementation happening by July.
CMEPA’s objective is to simplify income tax on passive income making it fairer. Among the proposed changes include charging the same tax rate (20 percent) on interest rates (currently there are four rates depending on the source of interest income). It also reduces the amount of stock transaction tax and documentary stock tax, makes gains from bond sales taxable.
However, CMEPA has a much deeper reach and one that’s only recognizable because of the bill’s long formal title: “AN ACT AMENDING SECTIONS 22, 32, 34, 38, 39, 42, 127, 174, 176, 179, 199, AND 258 OF REPUBLIC ACT NO. 8424, OTHERWISE KNOWN AS THE NATIONAL INTERNAL REVENUE CODE OF 1997, AS AMENDED, AND FOR OTHER PURPOSES.”
Tucked within the 80-page bill (specifically Section 149) is a provision which removes the excise tax exemption on all pickup trucks, including those used exclusively in the carriage of goods, presumably meaning single cab models.
Here’s the excerpt:
Tucked within the 80-page bill (specifically Section 149) is a provision which removes the excise tax exemption on all pickup trucks, including those used exclusively in the carriage of goods, presumably meaning single cab models.
Here’s the excerpt:
“SEC. 149. Automobiles. – There shall be levied, assessed and collected an ad valorem tax on automobiles based on the manufacturer’s or importer’s selling price, net of excise and value-added tax, in accordance with the following schedule:
x x x
Provided, That hybrid vehicles shall be subject to fifty percent (50%) of the applicable excise tax rates on automobiles under this Section: Provided, further, That purely electric vehicles [and pick-ups] shall be exempt from excise tax on automobiles.
As used in this Section –
(a) x x x
(b) Trucks/cargo van shall mean a motor vehicle of any configuration that is exclusively designed for the carriage of goods and with any number of wheels and axles: Provided, That pick-ups shall not be considered as trucks.
If this law is passed, pickup trucks will be subject to the full brunt of excise tax under the TRAIN or Tax Reform for Acceleration and Inclusion Law.
To recall, vehicles that is worth up to P 600,000 are taxed 4 percent of their price, 10 percent for vehicles priced higher than P 600,000 but below P 1 million, and 20 percent for vehicles priced above P 1 million but below P 4 million. Vehicles that are worth P4 million or higher are given a 50 percent tax.
Under this scheme, entry-level pickup trucks, including the recently-launched Tamaraw will only see a modest increase in price, if ever at all. However, higher-end pickup trucks such as the Toyota Hilux GR Sport, Ford Ranger Wildtrak and Raptor will get hit the most.
Under this scheme, entry-level pickup trucks, including the recently-launched Tamaraw will only see a modest increase in price, if ever at all. However, higher-end pickup trucks such as the Toyota Hilux GR Sport, Ford Ranger Wildtrak and Raptor will get hit the most.
With no definite timeline as to the signing of CMEPA, car brands have little to no time to build a stock buffer. And since excise tax is collected once a vehicle enters a Philippine port, car brands have no choice but to immediately pass on the additional tax to would-be customers in the form of a price adjustment.
Some dealers have already forewarned customers to expect a price hike of as much as P 200,000 once the law’s implemented for top-trim 4x4 models as early as June.
Major brands already increased their Pickup trucks prices almost 30% in since 2019 even without tax
ReplyDeleteGood. Too many pickup truck drivers with egos on the road.
ReplyDeleteI really love this government, they keep maximazing taxes and you get to see a very huge improvements especially infra in this country. The importation of almost everything including what this country is an abundant source of, makes me wanna hug them. Looking forward for this government to import an air for us to breath to tax the birds flying around.
ReplyDeleteI feel you brother. Same sentiments here. Wanna hug them very tight to break their bones and soffucate them. Damn corrupt government officials...
DeleteMay they have endless suffering. ..
Dapat lang. Daming nakakabili ng pick-up because of the affordable price, mga balahura naman mag-drive at di naman ginagamit pang-business which was the goal of the previous admin.
ReplyDeletePick-ups here are purchased and used more often as lifestyle vehicles rather than workhorses, specially high-grade variants like the Raptor V6 and GR Sport.
Deletebravo, that's our politicians with tens of millions (and many with hundreds of millions) in their sal-n. tax the people pa-more. not sufficient their tongpats and "commissions" (cuts), eh?
ReplyDeleteRalph Recto wants to collect more money so his wife,step son and son who are running as politicians in Batangas would have billions of Pesos worth of funds every year they can steal came from taxpayers money
DeleteNissan,Ford,Toyota and Isuzu are the ones gonna be heavily affected of that new law
ReplyDeleteValue wise, more affordable pickup car like GWM, JMC, JAC, FOTON pickup will price increase soon. plus those with electric motor BYD shark and Changan hunter.
ReplyDeleteAnd here nag babalak pa lang ako bumili ng pick up dahil nga walang excise sya at meaning better value for your cash. F this puro na lang pahirap.
ReplyDeleteYey parang tariffs narin naman toh good job
ReplyDelete