Republic of the Philippines
HOUSE 0F REPRESENTATIVES
Quezon City, Metro Manila
NINETEENTH CONGRES S
Second Regular Session
HouseBil|No.10038
Introduced by Representative JOEY SARTE SALCEDA
AN ACT IMPOSING A MOTOR VHHCLE ROAD USER'S TAX ON NON-
CONVENTIONAL VEHICLES, AMENDING FOR THE PURPOSE REPUBLIC ACT
NO. 8794, ENTITLED ``AN ACT "POSING A MOTOR VEHICLE USER'S
CHARGE 0N 0WrNHRS OF ALL TYPHS 0F MOTOR VEHICLES AND FOR
OTHER PURPOSES," AS AMHNDED BY REPUBLIC ACT NO.11239
EXPLANATORY NOTE
Based on market data, at least 1.4 million "non-conventional" vehicles, which include
three-wheeled or  four-wheeled  single-chassis  vehicles,  whether electric  or otherwise,  have
been  acquired  by  motor  vehicle  users  in  the  Philippines  since  2020,  when  Memorandum
Circular 2020-2227 was issued by the Land Transportation Office to prescribe the rates of
motor vehicle user' s charge imposed on these vehicles.
Furthermore, an estimated 432,000 of diesel-fueled three-wheeled vehicles under such
classification has been sold to the market during the said period.
MC  2020-2227  was  meant  to  be  a  temporary  measure,  intending  to  address  the
proliferation of such vehicles given the attractiveness of their price point as well as the need
for private transport during the COVID-19 pandemic.
Likewise, while MC 2020-2227 provided a temporary framework for imposing MVUC
on non-conventional vehicles,  only law could address ambiguities and uncertainty over the
permanence of such charges as well as the corresponding policies governing road access and
road safety.
The key public policy question is whether they should be treated as "tricycles" or as
"light cars." This policy question spills over to road access and road governance, where their
being confused with "tricycles" has left them in regulatory limbo, over whether they are subject
to local government restrictions on road use,


In terms of form (single-chassis, integrated unit), capacity (four-seater), and size, non-
conventional vehicles hem closer to light cars than to tricycles. While the conventional tricycle
is merely a motorcycle with an after-factory attached sidecar, non-conventional vehicles are
completely-built single units.
As such, the rates of tax imposed on such vehicles should also be closer to rates imposed
on light cars than rates imposed on tricycles.
This  bill  proposes  to  impose  the  same  rates  on  non-conventional  vehicles  as  those
proposed for light cars under House Bill No. 9647, approved by this House on third reading on
December 12, 2023.
Once enacted, this measure is expected to generate incremental revenues which could
be used to improve road infrastructure:
Revenues generated by imposing motor vehicle road user 's tax on "non-conventional
vehicles"  (in billions PHP)
2024
2025
2026
2027
Revenues
2.912
3.834
4.872
5.474
In view of the foregoing, the approval of this measure is urgently sought.
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Republic of the Philippines
HOUSE 0F REPRESENTATIVES
Quezon City, Metro Manila
NINETEENTH CONGRES S
Second Regular Session
House Bill No.10 03 8
Introduced by Representative JOEY SARTE SALCEDA
AN ACT IMPOSING A MOTOR VEHCLE ROAI) USER'S TAX ON NON-
CONVHNTIONAL VHHICLES, AMENDING FOR THE PURPOSE REPUBLIC ACT
NO. 8794, HNTITLED ``AN ACT IMPOSING A MOTOR VEHICLE USER'S
CHARGE 0N OWNERS 0F ALL TYPES 0F MOTOR VEHICLES AND FOR
0THHR PURPOSES," AS AMENDED BY REPUBLIC ACT NO. 11239
Be  it  erracted,  by  the  Senate  and House  Of Representatives  Of the  Philippines  in Congress
assembled:
Section 1. S*o# r!.f/c. - This Act shall be known as the "Non-Conventional Vehicles
Road User's Tax Act."
SEC. 2.  Section 2 of Republic Act No. 8794, as amended by Republic Act No.  11239,
is hereby amended to read as follows:
"SEC. 2. Covcrcrge. -[In lieu of the registration fee under Section 8 of Republic
Act No. 4136, as amended by Batas Pambansa Bilang 74, and the Private Motor Vehicle
Tax under Executive Order No.  43, series of 1986, there is hereby]  THE MOTOR
VHHICLE  ROAD  USER'S  TAX  SHALL  BE  imposed  on  every  motor  vehicle,
whether for hire or for private use, including government motor vehicles as [more fully]
provided in Section 3 hereof [a Motor Vehicle User's Charge (MVUC)], which shall
be collected from and paid by the owner of the motor vehicle."
SEC. 3.  Section 3 of Republic Act No. 8794, as amended by Republic Act No.  11239,
is hereby amended to read as follows:
"S;EC;. 3. LRates Of the Motor Vehicle User's Charge. -I RATES OF MOTOR
IE:HJCZE ROL4D I/SER'S 7:4X. -  (a) For private passenger cars registered as of the
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date of the effectivity of this Act, the MVUC to be paid shall be the private motor
vehicle tax under Executive Order No.  43,  series  of 1986,  plus twenty-five percent
(25%) for the first year, fifty percent (50%) for the second year, seventy-five percent
(75%)  for the  third year,  and one  hundred percent (100%)  for the  fourth year and
thereafter: Provided, however, That private passenger cars to be registered for the first
time after the effectivity of this Act, shall be subject to the MVUC rates prescribed in
Section 3(b) hereof.
"(b) Except as provided under Section 3(a) hereof, for each motor vehicle under
each of the categories as herein provided, the MVUC shall be collected from and pald
by the vehicle owner, at the following base rates plus twenty-five percent (25%) in the
first year from the effectivity of this Act; the said base rates plus fifty percent (50%) in
the second year from the effectivity of this Act; the said base rates plus seventy-five
percent (75%) in the third year from the effectivity of this Act; and the said base rates
plus one hundred percent (100%) in the fourth year from the effectivity of this Act and
thereafter: Provided, That the MVUC for sports utility vehicles shall be fifteen percent
( 15°/o) higher than the MVUC herein set for private utility vehicles: Provided, further,
That motorcycles for hire with sidecars shall not pay more than Three-hundred pesos
(P300).
Type of vehicle                 Base Rates
I. Private and Government
A. Passenger Cars
(1) GVW upto  1,600 kgs.                      P800
(2) GVW more than 1,600 kgs. -
2,300 k8s.
1,800
(3) GVw more than 2,300 kgs.            4,000
8. Utility Vehicles
GVW up to 2,700 kgs.
GVW more than
2,700 kgs. -4,500 kgs.
C. Motorcycles
P1,000
P1,000 + P20
per 100 kgs. of GVW over 2,700 kgs.
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without sidecar
with side car
D. Buses
GVW more than 4,500 kgs.
E. Trucks
GVW more than 4,500 kgs
F. Trailers
GVW more than 4,500 kgs.
11. For Hire
A. Passenger Cars
(1) GVW up to 1,600 kgs.
(2) GVW more than 1,600 kgs. -
2'300 kgs.
(3) GVW more than 2,300 kgs.
8. Utility Vehicles
GVW up to 4,500 kgs.
C. Motorcycles
without sidecar
with side car
D. Buses
GVW more than 4,500 kgs.
E. Trucks
GVW more than 4,500 kgs
F. Trailers
P900+P12 per 100 kgs. of GVW over 2,700 kgs.
P900+P12 per 100 kgs. of GVW over 2,700 kgs.
P12 per 100 kgs. of GVW
P450
900
2,500
P15 per 100 kgs. of GVW
P15 per 100 kgs. of GVW
P900+P12 per 100 kgs. of GVW over 2,700 kgs.
GVw more than 4,500 kgs.                  P12 per 100 kgs. ofGVW
G. NON-CONVENTIONAL VEHICLES
GVW of up to 1,600 kgs.
P2080 (2024)
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P2560 (2025)
P3040 (2026)
FIVE PERCENT (5%) INCREASE FROM 2027
ONWARDS
pRorTDED,    THAT    FOR    puRpOsE    OF    THls    ACT,    ..NON-
CONVENTI0NAL VEHICLES"  SHALL BE  A VEHICLE  TYPE  DISTINCT
AND  SEPARATE  FROM  MOTORcycLES  Wr[TH  SIDECAR AND  SHALL
INCLUDE  SYMMETRICALLY-ARRANGED  THREE-WHEEL  VEHICLHS,
LIGHT QUADRICYCLE, AND HEAVY QUADRICYCLE. After the fourth year
from the effectivity of this Act, the President of the Philippines may adjust the rates
contained in Section 3 which shall be reflective of but shall not exceed the annual rate
of increase of the Consumer Price Index (CPI). The President may adjust such rates not
more than once every five (5) years.
SEC.  3.  J"p/e7#e#/7.ng fzz{/es crj7c7 Zzegcj/crr7.o#f.  -  The DOTr,  in coordination with the
DOF and the LTFRB shall promulgate the mles and regulations to implement this Act within
thirty (30) days from its effectivity.
SEC. 4. j3epecr/7.ng C/cI2{se. - All laws, orders, issuances, circulars, rules and regulation
or parts thereof, which are inconsistent with the provisions of this Act are hereby repealed or
modifiedaccordingly.
SEC.  5. Sepczrczbj./j-/)J C/cz#Lse. -If any provision of this Act is declared unconstitutional
or invalid, other parts or provision hereof not affected thereby shall continue to be in full force
and effect.
SEC. 6. EJLTecJJ.vjfy. -This Act shall take effect fifteen (15) days after its publication in
the Official Gazette or in at least one ( 1) newspaper of general circulation.
Approved,
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