Congress gives nod to remove excise tax exemptions on pickup trucks

MANILA: The House of Representatives’ Ways and Means Committee has approved an expanded bill that included imposing excise taxes on pickup trucks.

This week, the Department of Finance (DOF) pushed for additional measures to what was once known as the Passive Income Financial Intermediary Taxation Act (Pifita), including the removal of the excise tax exemption on pickup trucks.

“Pickup trucks were granted the special tax treatment for their utility as workhorses for small business owners and professionals in their livelihood,” DOF Secretary Benjamin Diokno said in his letter to Ways and Means Committee Head Rep. Joey Salceda. “The Department of Trade and Industry has observed that manufacturers modify pickup trucks to serve as passenger, leisure or sports utility vehicles. This scheme allows manufacturers to circumvent the provision of the law and purpose of the exemption.”

Once the excise tax on pickup trucks is imposed, DOF estimates that additional tax collections will hit P52.6 billion from 2022 to 2026.

Photo by Roy Robles

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