Used vehicle imports cost government P2B

The government could have earned another P2 billion in taxes and duties from locally manufactured vehicles last year, if it had decided earlier to clamp down on the importation of used vehicles.

Local motor vehicle manufacturers said they could have possibly sold another 20,000 units last year with the government earning the P2-billion potential revenue based on last year’s vehicle sales of 76,670 units worth P60 billion on which the industry paid P6 billion in value-added tax; P2.637 billion in duties on imported parts; and P2.058 billion in excise taxes.

The Philippine Automotive Federation Inc. reiterated its appeal to the government to clamp down on the importation of used motor vehicles.

PAFI president Vicente Mills said that local vehicle manufacturers have already agreed to compromise on the importation.

However, they are opposing last minute moves to further lower the restriction to just 2.5 tons from the current regulated limit of 4.5 tons to six tons.

Elizabeth Lee, president of the Truck Manufacturers Association Inc. said that lowering the limit to 2.5 tons would affect the category 2 level which includes pick-ups and light commercial vehicles and trucks.

Lee said "the government must clarify exactly which category will be affected by the lower weight limit."

Mills is urging the government to make the hard decision taken by other ASEAN countries to protect its local motor vehicle industry.

"The local industry provides direct employment for 48,000 workers and has invested a total of P68 billion in its plants and operations in the country," Mills said.

"Allowing the continued importation of used vehicles would directly affect the viability of 266 auto parts manufacturers, 14 local car manufacturers, 20 commercial vehicle assemblers and 20 motorcycle makers," he added.