EO on temporary zero tariff for EVs signed

MANILA: To help the country's EV market, President Ferdinand R. Marcos Jr. has granted a temporary reduction in tariff rates on imported electric vehicle (EV) parts and components.

After the National Economic and Development Authority (NEDA) Board approved the temporary lowering of the Most-Favored Nation (MFN) tariff rates on selected EVs and their parts and components for five years on November 24, 2022, Marcos signed Executive Order (EO) 12 on January 13.

For a five-year period, EO 12 will temporarily cut the MFN tariff rates on fully built-up units of some EVs, including passenger cars, buses, minibusses, vans, trucks, motorbikes, tricycles, scooters, and bicycles.

However, hybrid-type EVs are exempt from the EO.

According to EO 12, the tariff rates on a few EV parts and components would also be reduced from 5% to 1% for a period of five years. The EO intends to aid in the adoption of new technologies and to persuade people to use electric vehicles as a more environmentally friendly mode of transportation.

EO 12 states that the State shall ensure the nation's energy security and independence through lowering dependency on imported petroleum for the transportation sector, citing RA 11697 or the Electric Vehicle Industry Development Act.

“The state has the paramount obligation to protect the health and well-being of the people from hazards of pollution and greenhouse gasses,” the EO stated.

"Under RA No. 11697, the State shall provide an enabling environment that permits the development of electric vehicles, including options for micro-mobility as an attractive and feasible mode of transportation," it elaborated.

A total of 34 percent of the nation's emissions of greenhouse gasses and air pollutants are attributed to the transportation sector, with 80 percent of those emissions coming from road transportation.

After it becomes effective, EO 12 will be in full force and effect for five years.

The presidential order that temporarily reduced the import duty rate on electric cars, parts, and components to zero for a period of five years was hailed by the Electric Vehicle Association of the Philippines (EVAP).

"Finally our EV industry will totally roll out in line with Executive Order No. 12 of PBBM (President Bongbong Marcos) as it opens a very good opportunity for those interested EV enthusiasts and advocates to own one," EVAP President Edmund Araga was quoted as saying in a report.

"Consumers will experience a wide array of models to choose from depending on their preferences," he added.

"As we all know, we now rely on importation of EV vehicles, specifically EV cars for personal mobility, which is far better than owning an internal combustion engine or even a hybrid," Araga explained.

"This will pave the way for supporting the EVIDA law or RA 11697 that makes the industry a promising one," he expressed.

A total of 13,934 EVs have reportedly been sold in the Philippines to date, according to the EVAP.

Photos from Nissan Philippines Inc., Meralco, and Dylan Afuang

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