Best Posts in Thread: 2018 and 2019 Vehicle Excise Tax Rise

Manila;; President Rodrigo Duterte has signed a Tax Reform Act on Tuesday and that $ 3.77 trillion budget for the 2018 government budget. - klajoo.com - The tax reform favors taxpayers earning less than $ 250,000 a year, meaning that those who earn $ 21,000 a month do not have to pay taxes. The tax deduction for the 13th month salary and other bonuses will be increased to 90,000 PHP. According to Bureau of Internal Revenue (BIR) data, approximately 6.8 million or 90 percent of the 7.5 million income taxpayers will be tax exempt from 2018. This is about three times the current two million exempt minimum wage earners. In order to offset the loss on income tax revenues, from 2018 Filipinos will have to apply higher excise duties on sweetened beverages and on oil, mining, coal, fuels and tobacco. For drinks that use sweeteners, a tax of 6 PHP is charged. For beverages made using high fructose corn syrup, a tax of 12 PHP is charged. Taxes on fuel will also increase, from 2018 a fuel tax on kerosene of 1 PHP and for diesel at 2.50 PHP per liter levied, the tax for regular gasoline and unleaded premium gasoline is currently 4.35 PHP by 2.65 PHP increased to 7 PHP. If you buy a new car worth up to PHP 600,000, you'll pay 4 percent instead of 2 percent, up to 10 percent for vehicles over PHP 600,000, 20 percent for vehicles from 1 million to 4 million, and for vehicles over 4 Million, 50 percent. Taxes on tobacco products will be increased from PHP 30 to 32.50 PHP from January to June 2018 and to PHP 35 from July 2018 to December 2019, from PHP to 37.50 PHP from 2020 to 2021, to PHP from 2022 to 2023 and from 2023 to 2023 4 percent of annual indexation is removed. The government budget of 3.77 trillion PHP for 2018, is 12.4 percent higher than the 3.35 trillion PHP of 2017. KR 21.12.2017 - 3:58
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From what I read NMISP stands for Net Manufacturer's/Importer's Selling Price.

That means that the base the tax is applied to is less than what you actually see on the price tag (margin of the dealer and VAT are not part of the NMISP). The second thing I take away from this fact is that this tax only applies to new cars being sold (and probably imported used cars sold here for the first time) .

In general I think taxing income less and consumption more is a good thing. Easiest way to make sure that the people who fill up the roads with their huge cars also pay their share, independently of how and where the money used to buy the thing was earned.

 

Even without the new excise tax being applied to sales of second hand vehicles, I would fully expect the price levels in the second hand market to reflect the new tax eventually.
On the other hand, if many new car buyers would try to "beat the deadline", there might be over-supply in the used car market for a while.

 

There are so many ridiculously cheap used cars for sale why would anyone want to buy a new car? New cars get trashed on the roads here real quick.