Truck makers push for 3% tariff on commercial vehicles

The Truck Manufacturers Association, Inc. (TMA) is appealing to President Estrada to "seriously reconsider" the recent decision of the government to increase tariff rates for commercial vehicles from three percent to 10 percent.

In its letter dated Jan. 16, 2001, the TMA expressed surprise about the promulgation of new tariff rates for 2001 until 2004 under EO 334.

Under EO 334, tariff rates for commercial vehicles, specifically for participants of the Commercial Vehicle Development Program (CVDP), would be raised from three percent to 10 percent and will only be brought down to five percent in 2004.

The TMA pointed out that late last year, it was widely publicized that the Cabinet-level Tariff Related Matters (TRM) committee approved the extension of the 2000 tariff rates until 2001, except for automotive and petrochemical industries whose tariff rates will be extended until 2004.

Within that context, the TMA explained, all completely knocked down (CKD) tariff rates of three percent should remain until the year 2004.

The issuance of EO 334, the TMA said, came as a surprise to the industry since it is a complete reversal of the TRM decision earlier adverted to.

The TMA argued that the complete turnaround of the government on a major policy matter in so short a period of time "puts the industry at a loss considering that we have made our respective plans on the basis of the earlier decision of TRM."

This predicament, the TMA said, is further exacerbated by the cost implication of the substantial increase in tariff rates to the local assemblers and its dampening effect on the market for commercial vehicles.

The TMA warned that "this tariff increase is untimely considering that it comes in the midst of a difficult economic situation that is now pervading the country today."

The TMA is appealing to the President to, therefore, restore the tariff rate to three percent from the higher rate of 10 percent.