Question & AnswerQ&A (Republic Act No. 8794)
The primary purpose of Republic Act No. 8794 is to impose a Motor Vehicle User's Charge (MVUC) on owners of all types of motor vehicles to provide and ensure adequate maintenance of national and provincial roads through sufficient funding.
The MVUC is imposed on every motor vehicle, whether for hire or private use, including government motor vehicles.
For private passenger cars registered as of the Act's effectivity, the MVUC is the private motor vehicle tax under Executive Order No. 43, series of 1986, plus 25% for the first year, 50% for the second year, 75% for the third year, and 100% for the fourth year and thereafter.
The MVUC is collected based on the base rates specific for each vehicle category plus an additional 25% in the first year, 50% in the second year, 75% in the third year, and 100% in the fourth year and thereafter from the effectivity of the Act.
Yes, government motor vehicles are subject to the MVUC, and the payment procedure will be according to rules promulgated by the Secretary of the Department of Budget and Management.
A penalty amounting to 25% of the MVUC is imposed for overloading trucks and trailers beyond their prescribed gross vehicle weight, with no axle load exceeding 13,500 kilograms.
All monies collected are to be used exclusively for road maintenance and improvement of road drainage, installation of traffic lights and safety devices, and air pollution control. They will be deposited in four special trust funds.
The four special trust funds are: (1) Special Road Support Fund, (2) Special Local Road Fund, (3) Special Road Safety Fund, and (4) Special Vehicle Pollution Control Fund.
The Road Board has seven members: the Secretary of the Department of Public Works and Highways (ex officio head), secretaries of the Departments of Finance, Budget and Management, and Transportation and Communications (ex officio members), and three members from transport and motorist organizations appointed by the President.
No, political subdivisions or units in the country are prohibited from imposing taxes, fees, or charges similar in nature to the MVUC on motor vehicles, including tricycles, motorized pedicabs, and trisikads.
The Act takes effect 15 days after its publication in at least two newspapers of general circulation.
Yes, the President may adjust the rates to reflect the annual rate of increase of the Consumer Price Index, but such adjustment shall not exceed this rate and can only be done once every five years.
Manufacturers or assemblers must submit specifications of new vehicle models to the Land Transportation Office (LTO) at least three months before market introduction. The LTO recommends the classification and MVUC rates for DOTC approval and releases classification within three months after receiving specifications.