Republic of the Philippines
House of the Representative
Quezon City

Eighteenth Congress
First Regular Session

HOUSE BILL No. $695

Introduced by Rep. Joey Sarte Salceda

EXPLANATORY NOTE

The challenge of the times for the Philippines, as a nation trapped in middle-
income status, is to accelerate infrastructure investments and to translate economic
growth into equitable gains for all. This becomes doubly challenging as the nation
faces unprecedented global threat of climate change that likewise
disproportionately affects the poor.

Serious solutions are called for that integrate these realities into public policy.
This measure seeks a holistic solution that optimizes the road user's tax while it
encourages the use of public transportation and addresses the ill-effects of pollution
to health

This measure imposes an optimal motor vehicle road users’ tax (MVRUT)
on all types of vehicles, a reasonable demand considering that the motor vehicle
user's charge (MVUC) has not been adjusted since 2004. Republic Act No. 8794
or An Act Imposing a Motor Vehicle Road User's Charge on Owners of All Types of
Motor Vehicles and for other Purposes, grants the President the authority to adjust
the MVUC rates annually by 2004, however, said presidential prerogative was
never exercised. As a result, the MVUC proceeds, which was supposed to finance
the infrastructure projects of the government, was not maximized. It also unduly
encouraged the purchase of vehicles.


To cushion the impact, the increase would be implemented in phases from
2020 to 2022. Further, the multi-tiered structure under Republic Act No. 8794 will
also be retained during the period. However, by January 1, 2023, a unitary rate at
P1.40 per kilogram of gross vehicle weight for all types of motor vehicles will be in
place.

The revenues from the MVRUT will finance road infrastructure projects of
the government. Further, the incremental revenues from the increase of MVRUT
shall help finance the modernization of public utility vehicles and universal health
care, the flagship projects of the administration of President Rodrigo Roa Duterte.
Specifically, the measure promotes efficient movement of people by providing
drivers and operators of public utility vehicles opportunities to modernize their fleet
through substantial equity subsidies. At the same time, the measure contributes to
the financing of universal health care, to ensure the productivity of the population,
particularly to those with less under the law.

In light of the foregoing, passage of this bill is earnestly sought.

eats

Pp. sy Sarte Salceda
Second District of Albay



Republic of the Philippines
House of Representatives
Quezon City

Eighteenth Congress
First Regular Session

HOUSE BILL No, 4635

Introduced by Rep. Joey Sarte Salceda

AN ACT AMENDING REPUBLIC ACT NO. 8794, ENTITLED “AN ACT
IMPOSING A MOTOR VEHICLE USER’S CHARGE ON OWNERS OF ALL
TYPES OF MOTOR VEHICLES AND FOR OTHER PURPOSES”, AS.
AMENDED BY REPUBLIC ACT NO. 11239

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

SECTION 1. This Act shall be known as the “Motor Vehicle 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. Coverage. - [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 VEHICLE ROAD USER’S TAX SHALL
CONTINUE TO 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:


“SEC. 3. [Rates of the Motor Vehicle User's Charge. - ] RATES OF MOTOR
VEHICLE ROAD USER'S TAX. - [(a) For private passenger cars registered as of
the 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 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 paid 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
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%) 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 (300.00).]

[ Type of Vehicle Base Rates

|. Private and Government
A. Passenger Cars

(1) GVW up to 1,600 kgs. P800
(2) GVW more than 1,600 kgs. —
2,300 kgs. 1,800

(3) GVW more than 2,300 kgs. 4,000
B. Utility Vehicles

GVW up to 2,700 kgs. P1,000
GVW more than P1,000 + P20
2,700 kgs. — 4,500 kgs. per 100 kgs. of GVW over 2,700 kgs.

C. Motorcycles
Without sidecar P120


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.
II, 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.
B. 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
GVW more than 4,500 kgs.

150

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

P150
240

P15 per 100 kgs. of GVW

P900+P12 per 100 kgs. of GVW over
2,700 kgs.

P12 per 100 kgs. of GVW ]

[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.]
“THERE SHALL BE LEVIED, ASSESSED, AND COLLECTED ON EVERY
REGISTERED PRIVATE AND GOVERNMENT VEHICLES, A MOTOR VEHICLE
ROAD USER’S TAX WHICH SHALL BE COLLECTED FROM AND PAID BY THE


OWNER OF THE MOTOR VEHICLE IN ACCORDANCE WITH THE FOLLOWING
SCHEDULE:

JANUARY | JANUARY | JANUARY
fypecivshicte 4, 2020 4, 2024 4, 2022
A. Passenger cars [
Gross vehicle weight
(GVW) up to 1,600 2,912 3,028 3,056
kilograms (kg)
GVW above 1,600 kg
but not exceeding 2,300 6,552 6814 | 6,876
kg ee Ses
GVW above 2,300 kg 14,560 15,142 15,280
B.1. Utility vehicles
GVW up to 2,700 kg 3,640 3,786 3,820
3,640 3,786 3,820
+ + +
GVW above 2,700 kg 73 75 76
but not exceeding 4,500 | per 100 kg. | per 100 kg. | per 100 kg.
kg of GVW of GVW of GVW
over 2,700 | over2,700 | over 2,700
kg kg kg
B.2. Sports utility
vehicles
GVW up to 2,700 kg 4,186 4,353 4,393
4,186 4,353 4,393
+ + +
GVW above 2,700 kg 84 87 88
but not exceeding 4,500 | per 100kg | per100kg | per 100 kg
kg of GVW of GVW of GVW
over 2,700 | over 2,700 | over 2,700
= kg kg kg
C. Motorcycles
Without sidecar with
engine displacement 0 0 0
below 400cc ft; 7
Without sidecar with
engine displacement of 437 454 458
400cc and above
With side car 546 568 573



JANUARY | JANUARY | JANUARY

Type of Vehicle 4, 2020 14,2021 | 14,2022
D. Buses |
GVW up to 4,500 kg 3,276 3407 | 3,438
3,276 3,407 3,438
+ + +
44 45 46

GVW above 4,500 kg per 100 kg|per 100 kg|per 100 kg
of  GVWiof GVWiof GVW
|over 2,700) over 2,700| over 2,700
| kg kg i kg

E. Trucks

3,276 3,407 3,438
+ + +

44 45 46

GVW above 4,500 kg per 100 kg|per 100 kg|per 100 kg
of  GVW\of GVWWiof Gvw
over 2,700 | over 2,700| over 2,700 |

kg kg i kg
F. Trailers a |
44 45 46
GVWabove 4,500kg | per 100 kg|per 100 kg|per 100 kg
ioe of GVW of GVW of GVW

“PROVIDED, THAT FOR HIRE VEHICLES SHALL BE SUBJECT TO 50%
OF THE ABOVE TAX RATES. PROVIDED FURTHER, THAT VEHICLES WITH
GVW ABOVE 2,700 KG BUT NOT EXCEEDING 4,500 KG AND WITH A
PASSENGER CAPACITY OF 18 PERSONS AND ABOVE SHALL BE
CLASSIFIED AS BUSES FOR PURPOSES OF THE IMPOSITION OF MOTOR
VEHICLE ROAD USER'S TAX.

“EFFECTIVE JANUARY 1, 2023:

BASE RATES PER |
KILOGRAM OF GVW

TYPE OF VEHICLE

ALL TYPES OF MOTOR VEHICLES WHETHER PRIVATE,
GOVERNMENT, OR FOR HIRE MOTOR VEHICLES P1.40
INCLUDING MOTORCYCLES WITH SIDE CAR



“PROVIDED, HOWEVER, THAT IN THE EVENT THE ABOVE TAX RATE
WILL RESULT IN DOWNWARD ADJUSTMENT OF TAX RATES, THE
APPLICABLE MOTOR VEHICLE ROAD USER’S TAX OF THE PRECEDING
YEAR SHALL BE APPLIED.

“PROVIDED, FURTHER, THAT THE RATES OF MOTOR VEHICLE ROAD
USER’S TAX SHALL BE INCREASED BY FIVE PERCENT (5%) ANNUALLY
EFFECTIVE JANUARY 1, 2024 THROUGH REVENUE REGULATIONS TO BE
ISSUED BY THE SECRETARY OF FINANCE.

“AS USED IN THIS SECTION —

“(A) “MOTOR VEHICLE” SHALL MEAN ANY VEHICLE PROPELLED
BY ANY POWER OTHER THAN MUSCULAR POWER USING THE PUBLIC
HIGHWAYS BUT EXCEPTING AIRCRAFT, MOTOR BOATS, ROAD ROLLERS,
TROLLEY CARS, STREET SWEEPERS, SPRINKLERS, LAWN MOWERS,
BULLDOZERS, GRADERS, FORK LIFTS, AMPHIBIAN TRUCKS, AND CRANES
NOT USED IN PUBLIC HIGHWAYS, VEHICLES WHICH RUN ONLY ON RAILS.
OR TRACKS, AND TRACTORS, TRAILERS AND TRACTION ENGINES OF ALL
KINDS USED EXCLUSIVELY FOR AGRICULTURAL PURPOSES.

“TRAILERS HAVING ANY NUMBER OF WHEELS, WHEN PROPELLED
OR INTENDED TO BE PROPELLED BY ATTACHMENT TO A MOTOR VEHICLE
SHALL BE CLASSIFIED AS SEPARATE MOTOR VEHICLE WITH NO POWER
RATING.

“(B) ‘GROSS VEHICLE WEIGHT’ SHALL MEAN THE MEASURED
WEIGHT OF A MOTOR VEHICLE AS SPECIFIED BY THE MANUFACTURER
PLUS THE MAXIMUM ALLOWABLE CARRYING CAPACITY IN
MERCHANDISE, FREIGHT, AND/OR PASSENGER AS DETERMINED BY THE
ASSISTANT SECRETARY OF THE LAND TRANSPORTATION OFFICE.

“(C) ‘OWNER’ REFERS TO ANY PERSON HOLDING TITLE TO A
MOTOR VEHICLE, OR HAVING THE LEGAL RIGHT TO REGISTER THE SAME,
INCLUDING PURCHASERS UNDER A CONDITIONAL SALE AGREEMENT.”

SEC 4. A new section designated as Section 3-A of Republic Act No. 8794,
as amended by Republic Act No. 11239, is hereby created to read as follows:


“SEC. 3-A. PAYMENT OF MOTOR VEHICLE ROAD USER’S TAX. —

“(A) PERSONS LIABLE - THE MOTOR VEHICLE ROAD USER'S TAX
SHALL BE PAID BY THE OWNER OF THE MOTOR VEHICLE TO THE LAND
TRANSPORTATION OFFICE (LTO), UPON EVERY ANNUAL REGISTRATION,
CONFORMABLY WITH THE REGULATIONS ISSUED JOINTLY BY THE
DEPARTMENT OF FINANCE AND DEPARTMENT OF TRANSPORTATION.

“THE MANNER OF PAYMENTS OF THE MOTOR VEHICLE ROAD
USER'S TAX ON GOVERNMENT MOTOR VEHICLES SHALL BE IN
ACCORDANCE WITH THE PROCEDURE THAT SHALL BE PROMULGATED
BY THE SECRETARY OF THE DEPARTMENT OF BUDGET AND
MANAGEMENT.

“(B) MANNER OF COLLECTION OF REVENUES - THE MOTOR
VEHICLE ROAD USER’S CHARGE SHALL BE COLLECTED BY THE LTO
FROM OWNERS OF MOTOR VEHICLES AS PART OF THE ANNUAL VEHICLE
REGISTRATION IN ACCORDANCE WITH THE RATES SET FORTH IN
SECTION 3 HEREOF. THE DATES OF ANNUAL REGISTRATION OF MOTOR
VEHICLES SHALL BE BASED ON THE REGISTRATION SCHEME PROVIDED
BY THE LTO.

“(C) EFFECT OF FAILURE TO PAY ROAD USER CHARGE- ANY
REGISTRATION OF MOTOR VEHICLES NOT RENEWED ON OR BEFORE THE
DATE FIXED BY THE LTO SHALL BE CONSIDERED DELINQUENT AND
INVALID.”

SEC 5. Section 7 of Republic Act No. 8794, as amended by Republic Act
No. 11239, is hereby further amended to read as follows:

“SEC. 7. Disposition of Monies Collected. - All monies collected under
this Act shall be remitted to the National Treasury [under a special account
in the General Fund to be earmarked solely for the construction, upgrading,
repair, and rehabilitation of roads, bridges, and road drainage to be included
in the annual General Appropriations Act.] AND SHALL ACCRUE TO THE
GENERAL FUND: PROVIDED, THAT ALL INCREMENTAL REVENUES
COLLECTED UNDER THIS ACT SHALL BE ALLOCATED AND USED


EXCLUSIVELY FOR THE FOLLOWING PURPOSES:
“(1) FIFTY PERCENT (50%) FOR THE IMPLEMENTATION OF REPUBLIC
ACT NO. 11223, OTHERWISE KNOWN AS THE ‘UNIVERSAL HEALTH
CARE ACT OF 2019’; AND

(2) FIFTY PERCENT (50%) FOR THE MODERNIZATION OF PUBLIC
UTILITY VEHICLES, PARTICULARLY FOR THE EQUITY SUBSIDY OF
PUBLIC TRANSPORT OPERATORS CONSOLIDATED AS TRANSPORT
COOPERATIVES FOR THE ACQUISITION OF EURO-4 COMPLIANT
PUBLIC UTILITY VEHICLES PLYING AUTHORIZED ROUTES AS
DETERMINED BY THE DEPARTMENT OF TRANSPORTATION (DOTr)
AND THE LAND TRANSPORT FRANCHISING AND REGULATORY
BOARD (LTFRB); PROVIDED, THAT SAID INCREMENTAL REVENUES
SHALL BE EARMARKED FROM JANUARY 1, 2020 TO DECEMBER 31,
2024 FOR THE MODERNIZATION OF PUBLIC UTILITY VEHICLES;
PROVIDED, FURTHER, THAT THE EARMARKED FUNDS SHALL BE
USED TO FUND THE UNIVERSAL HEALTH CARE EFFECTIVE
JANUARY 1, 2025.

SEC. 6. Implementing Rules and Regulations. - The DOTr, DOF, the DOH,

and the LTFRB shall jointly promulgate the implementing rules and regulations thirty
(30) days from the effectivity of this Act.

SEC. 7. Repealing Clause. - All other laws, orders issuance, circulars, rules

and regulation or parts thereof, which are inconsistent with the provision of this Act

are hereby repealed or modified accordingly

SEC. 8. Separability Clause. - 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. 9. Effectivity. - This Act shall take effect fifteen (15) days following its

publication in at least two (2) newspapers of general circulation.

Approved,