Question & AnswerQ&A (REVENUE REGULATIONS NO. 5-2018)
The scope of Revenue Regulations No. 5-2018 includes amending Revenue Regulations No. 25-2003 to provide for the revised rates of excise tax on automobiles pursuant to the provisions of the National Internal Revenue Code of 1997 and Republic Act No. 10963 (TRAIN Law).
A Hybrid Electric Vehicle is defined as a motor vehicle powered by electric energy, with or without provision for off-vehicle charging, in combination with gasoline, diesel, or any other motive power. It must be able to propel itself from a stationary condition solely using an electric motor.
The excise tax rates are: up to P600,000 - 4%; over P600,000 to P1,000,000 - 10%; over P1,000,000 to P4,000,000 - 20%; over P4,000,000 - 50% of the net manufacturer's/importer's selling price, net of excise and VAT.
Hybrid vehicles are taxed at fifty percent (50%) of the applicable excise tax rates on automobiles, subject to conditions specified in Section 9(e) of the regulation.
No, purely electric vehicles are exempt from the excise tax on automobiles.
Prior to removal from manufacturing or customs, the DOE must determine whether a vehicle is a hybrid or purely electric and furnish certified copies of the examination results to the Commissioner of Internal Revenue.
Within three months from the imposition of new rates, the Bureau of Internal Revenue will validate the selling price of new models to determine the correct tax bracket. Revalidation is done one year after and annually thereafter.
Manufacturers, assemblers, or importers must file updated sworn statements for each brand/model and submit a notarized inventory list of CBUs, CKDs, and SKDs within seven working days from the regulation's effectivity date.
Failure to submit the inventory list will be construed as having no inventory on hand of completely built-up, knocked-down, or semi-knocked down automobile units as of the date immediately before the regulation's effectivity.
These regulations took effect on January 1, 2018, following complete publication in the Official Gazette or at least one newspaper of general circulation.