TERMS DEFINED.

TRUCK/CARGO VAN
EXCISE TAX ON AUTOMOBILE shall refer to a motor vehicle of any configuration and
AUTOMOBILE-shall refer to any four (4) or more- with any number of wheels and axles that is
• There shall be levied, assessed and wheeled motor vehicle regardless of seating exclusively designed for the carriage of goods and
capacity, which is propelled by gasoline, diesel, actually used and registered as such with the Land
collected an ad valorem tax on electricity or any other motive power. Transportation Office: provided, that pick-ups shall be
automobiles based on the - for purposes of these Regulations, buses, considered as trucks.
manufacturer's/assembler's or trucks, cargo van, Jeeps/jeepneys/jeepney JEEP/JEEPNEY/JEEPNEY SUBSTITUTES
substitutes, single cab chassis, and special shall refer to the "Philippine jeep or jeepney" which are
importer's selling price, net of excise purpose vehicles as herein defined shall not of the jitney type locally designed and manufactured
generally from surplus parts and components. It shall
and value-added tax. be considered as automobiles.
- NOTE: pick-ups (commonly used for also include jeepney substitutes that are manufactured
commercial and agricultural purposes) and for brand new single cab chassis or cowl chassis and
electric vehicles will be exempt from payment locally customized rear body that has continuous
of excise taxes as per TRAIN (Tax Reform for sideway row seats with open rear door and without
Acceleration and Inclusion) Act. Hybrid Cars retractable glass windows
will be subjected to excise taxes at half the
rates.

BUS-shall refer to a motor vehicle of any configuration HYBRID ELECTRONIC VEHICLE shall COMPLETELY KNOCKED DOWN (CKD)-shall
with gross vehicle weight of four (4) tons or more with any refer to parts and components for assembly purposes
number of wheels and axles, which is generally accepted mean a motor vehicle powered by electric that are imported in disassembled condition. The
and specially designed for mass or public transportation. energy, with or without provision for off- CKD pack, however, may include not only parts and
SINGLE CAB CHASSIS shall refer to a motor vehicle with vehicle charging, in combination with components but also sub assemblies and assemblies
complete engine power train and chassis equipped with a such as engine, transmission, axle assembles, chassis
cab that has a maximum of two (2) doors and only one (1) gasoline, diesel or any other motive
and body assemblies.
row of seats. power; Provided, That, for purposes of this SEMI-KNOCKED DOWN (SKD)-shall refer to parts
SPECIAL PURPOSE VEHICLE-shall refer to a motor act, a hybrid electric vehicle must be able
vehicle, other than truck, cargo van, jeep/jeepney/jeepney and components for assembly purposes that are
substitute, bus, single cab chassis as defined herein, to propel itself using electric motor. imported in partially assembled condition. SKDS
designed for specific applications such as cement mixer, Provided, that in the case of imported include semi-assembled vehicles, for purposes of ad
fire truck, boom truck, ambulance and/or medical unit, and valorem tax the same shall be treated as CBU.
off-road vehicles for heavy industries and not for automobiles not for sale, the tax imposed COMPLETELY BUILD UP (CBU)-shall refer to
recreational activities. For this purpose, "designed for herein shall be based on the total landed vehicles imported in completely assembled form and
specific applications" shall mean the motor vehicle is value, including transaction value, ready for use by the consumers.
designed in such a manner that it can only be used strictly.
customs duty and all other charges. -
Automobiles used exclusively within the
freeport zone shall be exempt from excise
taxes.
PERSONS LIABLE The following persons shall RATES AND BASES OF THE AD RATES AND BASES OF THE AD
be liable. for the payment of ad valorem tax on VALOREM TAX ON VALOREM TAX ON AUTOMOBILES
automobiles: AUTOMOBILES ON HYBRID VEHICLES
a. On locally manufactured/assembled Net Manufacturer’s Price Rate Net Manufacturer’s Price Rate
automobiles The excise tax shall be paid Up to P 600,000.00 4% Up to P 600,000.00 2%
by the manufacturer/ assembler of
automobiles. Over P 600,000.00 – 10% Over P 600,000.00 – 5%
b. On imported automobiles P 1, 000, 000.00 P 1, 000, 000.00
The excise tax shall be paid by the owner or Over P 1, 000, 000.00 – 20% Over P 1, 000, 000.00 – 10%
importer of the automobile or by the P 4, 000, 000.00 P 4, 000, 000.00
dealer/trader. or by any person who is found Over P 4, 000, 000.00 50% Over P 4, 000, 000.00 25%
in possession of any untaxed automobiles
including any person other than the one
legally entitled to exemption from the
advalorem tax in the proper case.
MANUFACTURER’S OR IMPORTER’S SELLING PRICE RATES OF DUTY FOR AUTOMOBILE
shall refer to the price, net of excise and value added taxes, BASES OF BOOK VALUE 87.02 Includes among others. automobiles
at which locally manufactured/assembled or imported AVAILABLE FOR THE VALUATION
automobiles are offered for sale by the for the transport of 10 or more persons,
manufacturer/assembled or importer to the dealers, or to the OF AUTOMOBILE including the driver. (e.g. 14 - seater vans)
public directly or through their sales agents, as reflected in
the manufacturer's/assembler's or importer's sworn It shall be determined based on the Rate of duty-20% ad valorem
statement duly filed with the BIR, or in their sales
invoices/official receipts, whichever is higher, provided, country of origin.
that in computing the manufacturer's/assembler's or 87.03 Includes among others,
importer's selling p shall always include the value of car 1. Japan - Auto Guide Market
air conditioner, radio and mag wheels including the cost of automobiles for the transport of 9
installation thereof whether or not the same were actually Report. (AGMR) persons and below. (passenger cars,
installed in the automobile. Provided, further, that in no 2. US - US Red Book
case shall the manufacturer's/assembler's or importer's 3. Europe - KARO Book -Korean station wagons, sports cars and racing
selling price bo less than the amount computed as follows: Book cars)
80% x (Suggested Retail Price-Excise Tax- Value-Added 4. Korea - Korean Book
Tax) 5. China and Dubai - Red Book Asia Rate of duty-30% ad valorem
Pacific.com

IMPORTATION OF AUTOMOBILES - Filipino Diplomats/DFA officials defined, a BRAND NEW AUTOMOBILES

ARE CATEGORIZED AS FOLLOWS: Filipino who worked in the Philippine As contemplated under DOF Joint Order No. 1 2010
1. Brand new consigned to car embassy abroad. refers to the following criteria:
manufacturer/dealer - Filipino Returning residents defined, a person 1. Of current or advance year model in the
2. Brand new consigned to natural person who have resided abroad for at least 1 year. country of origin and/or manufacture, or
3. Used consigned to Filipino diplomats [accumulated within 3 years of his/her stay abroad 2. With year model of the immediately preceding
and/or DFA officials immediately preceding the date of filing of the year in the country of origin and/or manufacture
4. Used consigned to Filipino returning Certificate of Authority to Import (CAI). provided that:
- Privilege person defined, a foreigner who have a. The motor vehicle has mileage of not more than 200
residents who have resided abroad for at worked in their respective embassies in the kms or 125 miles, and
least 1 year Philippines, thus granted with exemptions from b. The motor vehicle has been acquired by the
5. Sale of automobile from privilege payment of customs duties, value added taxes and importer from the car dealer as first owner
person to a non- privilege person (Local excise taxes. - A brand new automobile with year model of
- Non-privilege person defined, a Filipino citizen immediately preceding year shall not be accorded
Purchase) any depreciation allowance.
who acquired the automobile from the privilege
6. Sale of automobile from privilege person
person therefore subject to payment of duties,
to another privilege person (Local value added taxes and excise tax
Purchase)
DEPRECIATED VALUE OF How do you derive with the correct Importer
AUTOMOBILE Selling Price for the importation of brand new NOTE: HYBRID ELECTRONIC VEHICLE
automobiles consigned to car manufacturer/ shall mean a
The depreciated value of automobile dealer? motor vehicle powered by electric energy,
at the time. of sate, transfer, or with or without provision for off-vehicle
exchange shall be based on a. 80%X (Suggested Retail Price - [value added charging, in combination with gasoline,
Automobile of Allocate Depreciation tax (VAT) + excise tax (ET)]) diesel or any other motive power; Provided.
Year d Rate
Model Depreciati (Multiplier)
That, for purposes of this act, a hybrid
b. Gross Selling Price-[value added tax (VAT) +
on electric vehicle must be able to propel itself
excise tax (ET)]
Current Year 0% None using electric motor. However, if it is a
1 year old 10% x.90 - To derive for the correct ISP to be used as basis purely electronic vehicle, therefore it is not
2 years old 20% x.80 for the computation of ad valorem tax for brand considered as hybrid thus, treated as
3 years old 30% x.70 new automobile consigned to Car exempted from payment of the excise tax as
4 years old 40% x.60 Manufacturer/Dealer choose whichever is higher clearly stipulated in the provisions of the
5 years old 50% x.50 between a and b. Tax Reform for Acceleration and Inclusion
(TRAIN) law.
AUTOMOBILES SUBJECT TO EXEMPTION
FROM PAYMENT OF AD VALOREM TAX
UNDER TRAIN LAW

1. Pick-ups (commonly used for

commercial and agricultural purposes)
2. Purely electric vehicles
3. Automobiles used exclusively