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Republic of the Philippines
HOUSE OF REPRESENTATIVES se november 203 m
‘Quezon City = > 7)
* TIME
NINETEENTH CONGRESS
Second Regular Session

HOUSE BILL NO. 9442 _
Introduced by Representative Joseph Gilbert F. Violago

EXPLANATORY NOTE

Two decades ago, 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” was enacted into law. Consequently, certain provisions of the law were
amended by Republic Act No. 11239 in 2018,

In order to ensure the adequate maintenance of national and provincial roads
through sufficient funding, as envisioned by the prevailing law, the proposed measure
seeks to simplify the MVUC to reflect a more responsive system. Under this measure,
a motor vehicles road user’s tax (MVRUT) shall be imposed on private and government
vehicles, except for motorcycles with or without sidecars. For hire vehicles, however,
shall be subject to 50% of the proposed tax rates.

Likewise, the bill seeks to provide allocation of a portion of incremental revenues
collected for a myriad of purposes, including but not limited to the modernization of
public utility vehicles, government programs for the prevention of fatalities due to road
accidents, improvement of drivers’ education programs and road management systems,
and others.

A similar bill was approved on Third and Final Reading last 18" Congress, and
was transmitted to the Senate; however, the same was not passed into law due to lack
of material time. The present proponent acknowledges the hard work and wisdom of his
predecessors.

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

JOSEP! ERT F. VIOLAGO


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

NINETEENTH CONGRESS
Second Regular Session

HOUSE BILL NO. _9442

Introduced by Representative Joseph Gilbert F. Violago

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".

SECTION 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 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.”

SECTION 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) TAX. — For private
passenger cars registered as of the date of 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 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 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%) 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 Basic Rates
|. Private and Government
A. Passenger Cars

(1) GVW up to 1,600 kgs. 800
(2) GVW more than 1,600 kgs. ~ 2300 kgs. 1,800
(3) GVW more than 2,300 kgs. 4000
B. Utility Vehicles
GVW up to 2,700 kgs. P1000
GVW more than 2,700 kgs. ~ 4,500 kgs. P1,000 + P20 per 100
kgs. of
GVW over 2,700 kgs.
C. Motorcycles
Without sidecar P120
With sidecar 150
D. Buses
GVW more than 4,500 kgs P900 +
P12 per
100 kgs.
of GVW
over 2,700
kgs.

E. Trucks


GVW more than 4,500 kgs. P900 +

P12 per
100 kgs.
of GVW.
over 2,700
kgs.
F. Trailers
GVW more than 4,500 kgs. P12 per 100kgs. of
Gvw
I. For Hire
A. Passenger Cars
(1) GVW up to 1,600 kgs. P4s0
(2) GVW more than 1,600 kgs. ~ 2300 kgs. 900
®) GVW more than 2,300 kgs. 2,500
B. Utility Vehicles
GVW up to 4,500 kgs PIS per 100kgs. of
Gvw
C. Motorcycles
Without sidecar PISO
With sidecar 240
D. Buses
GVW more than 4,500 kgs. PIS per 100 kgs of
GVW
E. Trucks
GVW more than 4,500 kgs 900 +
P12 per
100kgs. of
GVW
over 2,700
kgs.
F. Trailers
GVW more than 4,500 kgs. P12 per 100kgs 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 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:

TYPE OF VEHICLE

2023 2024 2025 2026
ONWARDS

PRIVATE GOVERNME!
‘A. Passenger Cars
Gross Vehicle 2,080 2560 3040
Weight (GVW)
upto 5% Increase
1,600
Kilograms (kg)
GVW more than 1,600 kg | 4,680 5,760 6,840
| up to 2,300 kg
GVW more than 2,300 kg | 10,400 | 12,800 __| 15,200
BI. Utility Vehicles

GVW up to 4,500 kg 1.40 2.50 3.40 5% Increase
pe pe pe
rkgof |rkgof | rkgof
Gvw Gvw Gvw

B2. Sports Utility Vehicles
GVW up to 4,500 kg 1.40 2.50 3.40 5% Increase

pe pe pe
rkgof |rkgof | rkgof
Gvw GVW Gvw

C. Motorcycles

Without Sidecar 0 0 0 0

With Sidecar 0 0 0 0

D. Buses

GVW up to 4,500 kg 140 per 12.50 per [3.40 per [5% Increase
kg of GVW) kg of GVW| kg of GVW]

E, Trucks

GVW up to 4,500 kg 1.40 per {2.30 per [3.40 per [5% Increase
kg of GVW| kg of GVW] kg of GVW

F. Trailers

GVW up to 4,500 kg 140 per [250 per [340 per |5% Increase

kg of GVW| kg of GVW| kg of GVW)



"PROVIDED, THAT FOR HIRE VEHICLES SHALL BE
SUBJECT TO FIFTY PERCENT (50%) OF THE ABOVE TAX
RATES: 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,
2026 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 PUBLIC HIGHWAYS BUT EXCEPTING
AIRCRAFTS, MOTOR BOATS, ROAD ROLLERS, TROLLEY
‘CARS, STREET SWEEPERS, SPRINKLERS, LAWN MOWERS,
BULLDOZERS, GRADERS, FORKLIFTS, AMPHIBIAN
TRUCKS, AND CRANES NOT USED IN PUBLIC HIGHWAYS,
VEHICLES WHICH RUN ONLY ON RAILS OR TRACKS,
TRACTORS AND 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, OR PASSENGER AS DETERMINED BY THE
ASSISTANT SECRETARY OF THE LAND TRANSPORTATION
OFFICE (LTO).


SECTION 4. Section 4 of Republic Act No. 8794, as amended by Republic Act No.
11239, is hereby amended to read as follows

"SEC. 4. GOVERNMENT MOTOR VEHICLES
4

“SEC. 4. PAYMENT OF MOTOR VEHICLE ROAD USER'S
TAX. — The manner of payment of the [user's charge] 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 (DBM) [.]:

"(A) MANNER OF PAYMENT. ~ THE MOTOR VEHICLE
ROAD USER'S TAX SHALL BE PAID TO THE LTO ANNUALLY
UPON REGISTRATION, CONFORMABLY WITH THE
REGULATIONS ISSUED JOINTLY BY THE DEPARTMENT OF
FINANCE (DOF) AND DEPARTMENT OF TRANSPORTATION
(DOTr).

"(B) MANNER OF COLLECTION OF REVENUES, — THE
MOTOR VEHICLE ROAD USER'S TAX SHALL BE
COLLECTED BY THE LTO 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 MOTOR VEHICLE
ROAD USER'S TAX. - ANY REGISTRATION OF MOTOR
VEHICLES NOT RENEWED ON OR BEFORE THE DATE
FIXED BY THE LTO SHALL BE CONSIDERED DELINQUENT
AND INVALID."

SECTION 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 [.]: PROVIDED,
THAT FIFTY PERCENT (50%) OF THE INCREMENTAL
REVENUES COLLECTED UNDER THIS ACT SHALL BE


ALLOCATED AND USED EXCLUSIVELY FOR
THEFOLLOWING PURPOSES:

"(l) FORTY-FIVE PERCENT (45%) 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 DOTr AND
THE LAND TRANSPORTATION FRANCHISING AND
REGULATORY BOARD (LTFRB): PROVIDED, THAT SAID
INCREMENTAL REVENUES SHALL BE EARMARKED UPON
APPROVAL OF THIS ACT UNTIL DECEMBER 31, 2027 FOR
THE MODERNIZATION OF PUBLIC UTILITY VEHICLES:
PROVIDED, FURTHER, THAT THE EARMARKED FUNDS
SHALL REVERT TO THE SPECIAL 20 ACCOUNT IN THE
GENERAL FUND EFFECTIVE JANUARY 1, 2028;
(2) FIVE PERCENT (5%) FOR GOVERNMENT
PROGRAMS TO BE UNDERTAKEN FOR PREVENTION OF 24
DEATHS DUE TO ROAD ACCIDENTS, AND ACCIDENT 25
VICTIMS' ASSISTANCE, INCLUDING THE FOLLOWING:

(a) THE IMPROVEMENT OF EXISTING DRIVERS’
EDUCATION PROGRAMS, TRAINING ACADEMIES AND
DRIVERS' LICENSE EXAMINATIONS BY THE LTO;

(b) THE ESTABLISHMENT OF ADDITIONAL MOTOR
VEHICLE INSPECTION CENTERS BY THE LTO;

(c) THE IMPROVEMENT OF ROAD MANAGEMENT

SYSTEMS BY THE DOTr;

(@) THE PROVISION OF SUPPLEMENTAL
HOSPITALIZATION COVERAGE BY THE PHILIPPINE
HEALTH INSURANCE CORPORATION (PHILHEALTH) FOR
VICTIMS OF ROAD ACCIDENTS;

(&) THE PROVISION BY THE EMPLOYEES'
COMPENSATION COMMISSION OF WORKMEN’
COMPENSATION FOR VICTIMS OF ROAD ACCIDENTS WHO
ARE UNABLE TO BE GAINFULLY EMPLOYED FOR A
CONTINUOUS PERIOD DUE TO DISABILITY, PURSUANT TO
THE PROVISIONS OF REPUBLIC ACT No. 772, AS AMENDED,
OR THE WORKMEN'S COMPENSATION ACT;

(f) THE ESTABLISHMENT BY THE DEPARTMENT OF
HEALTH (DOH) OF EMERGENCY CARE FACILITIES IN



AREAS THAT HAVE HIGH INCIDENCE OF ROAD
ACCIDENTS."

SECTION 6. Implementing Rules and Regulations. — The DoTr, in coordination with
the DOF, the DOH, and the LTFRB shall promulgate the necessary rules and regulations
to effectively implement the provisions of this Act, within ninety (90) days from its
effectivity.

SECTION 7. Separability Clause. ~ If any provision or part of this Act, or the
application thereof to any person or circumstance, is held unconstitutional or invalid,
the remainder of this Act shall not be affected thereby.

SECTION 8. Repealing Clause. — All laws, presidential decrees, executive orders,
proclamations, rules and regulations, or any part thereof, which are inconsistent with
the provisions of this Act are hereby repealed or modified accordingly.

SECTION 9. Effectivity. - This Act shall take effect fifteen (15) days after its
publication in the Official Gazette or in a newspaper of general circulation.

Approved,