Trade Secretary Alfredo Pascual supports moves to review the exemption from excise tax double-cab pickups which he said have become lifestyle, fully accessorized vehicles and far from the original intent of the exemption, for cargo mobility of small businesses.
Pascual said the regular single-cab and chassis pick-up has always been exempt from excise tax even before the Tax Reform for Acceleration and Inclusion (TRAIN) law as it has been the real utility workhorse vehicle.
However, the TRAIN law extended the exemption to the double-cab pick-up ostensibly to support the cargo mobility requirement of micro, small and medium enterprises (MSMEs).
“However, it seems that the imported double-cab pick-up is often a fully-accessorized passenger unit – a lifestyle vehicle far from the need and reach of MSMEs,” Pascual said.
Since the excise tax exemption applies to the whole vehicle, the double-cab pick-up accessories also get exempted from the excise tax.
The committee on ways and means last month approved a bill that includes lifting the excise tax exemption on pickup trucks.
The Department of Finance estates imposing the excise tax on pickup trucks would generate additional tax collections of P52.6 billion from 2022 to 2026.
