Philippines sustains EV boost with extended zero tariff

The Philippines has extended its zero-tariff policy on electric vehicles (EVs) and their parts until 2028, aimed at transitioning the country away from fossil fuels and bolstering its EV market, a government economic committee led by President Ferdinand Marcos Jr. announced, as reported by Reuters on Thursday.

The committee has also expanded the preferential tax rates to encompass hybrid electric vehicles, e-motorcycles, and e-bicycles.

This follows Marcos’ initial approval in January 2023 to reduce the most-favoured nation tariff on EVs, including cars, vans, and buses, to 0 per cent from a previous range of 5 per cent to 30 per cent.

President Marcos, whose term concludes in 2028, has prioritised renewable energy and climate change mitigation in his policy agenda advocating for cleaner alternatives to fossil fuels in the Philippines, a country highly susceptible to extreme weather events.

Under its Paris Agreement commitments, the Philippines is targeting a 75 per cent reduction in greenhouse gas emissions by 2030.

The impact of these rates on the country’s EV market will be reviewed annually.

The Philippines’ automotive sector, which primarily depends on imported fuel and purchases oil and coal from overseas for its energy needs, remains vulnerable to price volatility.