EIGHTEENTH CONGRESS OF THE )

REPUBLIC OF THE PHILIPPINES >)
First Regular Session )
HOUSE OF REPRESENTATIVES
H.B.No,_4356

Introduced by Rep. Vilma Santos-Recto
6" District of Batangas

AN ACT

EXEMPTING THE MANUFACTURE, ASSEMBLY, CONVERSION AND
IMPORTATION OF PLUG-IN HYBRID ELECTRIC VEHICLES FROM THE
PAYMENT OF EXCISE TAXES AND DUTIES, AND FOR OTHER PURPOSES

EXPLANATORY NOTE

Natural disasters and their high costs have driven people to seek for urban
mobility solutions that address climate and environmental issues.

By choosing to use clean transportation options that reduce the environmental
impact of our mobility, consumers can play an active role in the energy transition. But the
consumer is not alone in taking this route because the government must be in the forefront in
its commitment to green mobility.’

Albeit late, the government should start protecting the consumers, the climate,

and our environment from the growing costs and risks of our fossil fuel use.

"Green mobility sustainable transpoation that lows he bai acess neds of indus and societies tobe met safely and in 2 manner consistent with
‘aman dete anh ety in an betwen gras lei nd wate wn he pane’ ay ss ha,

Components,
Technology, Vo 4, wave, August 2015)


As the title of the measure suggests, this bill seeks to exempt the manufacture,
assembly, conversion and importation of plug-in hybrid electric vehicles (PHEVs) from the
payment of excise taxes and duties. A PHEV which is an evolution of electric vehicles makes
a more attractive alternative to consumers due to its lower fuel consumption, lower operating
cost, elimination of range anxiety” and lower carbon footprint. Moreover, current global sales
figures as well as planned releases show that PHEVs shall have a dominant share at 70% in
the sales of electric vehicles by 2030.°

The bill’s primary objective is to help expand the use of this sunrise industry and
generate economic growth while promoting environmental protection. The use of PHEVs for
public and private transport will encourage technology innovation, create green jobs,
accelerate the deployment of green vehicles, increase fuel savings, promote better air quality
and provide climate change mitigation.

The bill includes sunset provisions on when the incentives expire. Any
manufacturer or assembler of PHEVs has nine (9) years to avail of the incentives under this
bill, thereby allowing the industry enough time to grow and develop, and become the leading
type of vehicle in the market.

‘The passage of this bill supports the Fueling Sustainable Transport Program
(FSTP) of the Department of Energy (DOE), which is an
transport use in the Philippines. The program seeks to convert public and private vehicles

iative on diversifying fuels for

from diesel and gasoline to low- and zero-emission vehicles to address the impact of
increasing fuel prices and reduce carbon footprint on the transport sector.’ Retrofitting the
rest of the public utility vehicles (PUVs) like jeepneys and buses can have a tremendous
impact on clean environment.

* kange ant isthe fer that vehice has nslcent range wo reach ts destination and would thus strand the vhid's occupants. The term, which is
mari edn reternc to batery eee voices conser to bon of he mao bares ore sl dopton

loa EV Outlook 2039 a (acesed hy 22039)

Splng sustainable transport program to mate fol price Iereases in the future


If the manufacturers can avail of the fiscal incentives to bring down their input
costs, they can offer more competitive price for plug-in hybrid electric vehicles as compared
to their existing gasoline-fed counterparts.

In view of the foregoing, immediate approval of

VILMA SANTOS-RECTO


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EIGHTEENTH CONGRESS OF THE )

REPUBLIC OF THE PHILIPPINES )
First Regular Session )
HOUSE OF REPRESENTATIVES

H.B.No._4356

Introduced by Rep. Vilma Santos-Recto
6" District of Batangas

AN ACT
EXEMPTING THE MANUFACTURE, ASSEMBLY, CONVERSION AND
IMPORTATION OF PLUG-IN HYBRID ELECTRIC VEHICLES FROM THE
PAYMENT OF EXCISE TAXES AND DUTIES, AND FOR OTHER
PURPOSES

Be it enacted by the Senate and House of Representatives of the Philippines in
Congress assembled:

Section 1. Short Title. ~ This Act shall be known as the "Plug-In Hybrid
Electric Vehicles Incentives Act".

Sec. 2. Declaration of Policy. — It is the policy of the State to safeguard life
and environment by encouraging the use of clean energy sources for vehicles intended
for public and private use. To protect the well-being and promote the economic
condition of the people as well as to promote energy independence and security in the
midst of development and innovation in technology, the following are hereby
declared:

a) The State shall recognize and address the detrimental effects on the
environment, safeguard the welfare and protect the health of the people by improving
air quality and by reducing the impact of greenhouse gas effects emitted from man-
made sources such as vehicles operating on fossil fuels.

) The State supports the need to promote the development of new technology
to accelerate social progress and promote human development. The use of eco-
friendly or green vehicles intended for public and private use is encouraged to
promote innovation, energy efficiency, security and conservation, and to speed-up the
deployment of cleaner technology.


©) The State recognizes the indispensable role of the private sector, encourages
private enterprise, and provides incentives to needed investments. To accelerate
economic growth and generate employment while upholding environmental
protection, the state shall provide incentives to private enterprises and individuals
engaged in the manufacture, assembly, conversion, and importation of plug-in hybrid
electric vehicles.

Sec. 3. Definition of Terms. — As used herein, the following shall mean:

(a) Plug-In Hybrid Electric Vehicle (PHEVs) shall refer to an electrical vehicle
that uses rechargeable batteries, or another energy storage device, that can be
recharged by plugging it to an external source of electric power; its drive system
consists of an efficient combustion engine and a powerful electric motor; it is able to
cover short and medium distances using pure electric power with a minimum range of
30 kilometers, as certified by the manufacturer in its country of origin and achieved
with the innovative combination of electric motor, lithium-ion battery and intelligent
energy management.

(6) Manufacturer or Assembler shall mean any individual, partnership,
corporation or other entity engaged in the manufacture, assembly and conversion of
PHEVs and incorporated or organized and existing under Philippine laws.

(©) Importer shall mean any individual, partnership, corporation or other entity
engaged in the importation of completely built units (CBUs) of PHEVs incorporated
or organized and existing under Philippine laws.

Sec. 4. Incentives to Manufacturers, Assemblers or Importers. — The provision
of any special or general law to the contrary notwithstanding, the manufacture or
assembly of completely knocked-down (CKD) parts of PHEVs as well as the
importation of completely built units (CBUs) of the same, shall be exempt from the
payment of excise taxes and duties for nine (9) years from the effectivity of this Act.

Sec. 5. Registration, Implementation and Monitoring. — The Department of
Finance (DOF) shall be responsible for the administration and implementation of the
incentives granted under this Act.

Manufacturers, assemblers, converters and importers of PHEVs shall register
with DOF in order to avail of the incentives provided under this Act. For proper
monitoring, DOF shall regularly monitor and review the implementation of the

incentives provided herein.


Sec. 6. Implementing Rules and Regulations. - The DOF, in consultation with
the Department of Transportation, shall within sixty (60) days from the effectivity of
this Act, formulate the rules and regulations to effectively implement the provisions
of this Act.

Sec. 7. Separability Clause. — If any portion or provision of this Act is
declared unconstitutional, the remainder of this Act or any provisions not affected
thereby shall remain in force and effect.

Sec. 8. Repealing Clause. — Any law, presidential decree or issuance,
executive order, letter of instruction, rule or regulation inconsistent with the
provisions of this Act is hereby repealed or modified accordingly.

Sec. 9. Effectivity Clause. - This Act shall take effect fifteen (15) days
following its complete publication in two (2) newspapers of general circulation or in
the Official Gazette.

Approved,