Vehicle import tariffs won’t be increased — BoI

THE BOARD of Investments (BoI) will not move to raise tariffs on imported vehicles contrary to some automotive companies’ fears, a ranking official said late on Monday.

The state agency will stand pat, however, on its policy stance of favoring local assemblers over importers in terms of investment incentives, BoI Executive Director Efren V. Leano said in a telephone interview.

This comes as the BoI is currently drafting the implementing rules of the new Motor Vehicle Development Program (MVDP) — laid down by Executive Order 877-A — and due by end-August.

The Alliance of Vehicle Importers and Dealers urged Malacañang last week to recall the directive, issued by the previous administration, as the program will allegedly “price imported vehicles out of the market.”

But Mr. Leano clarified: “We cannot change tariffs [on completely built up units]. We’re even bound to lower them [under various trade agreements].”

“We are not here to disadvantage any group.”

It is true, however, that the program will continue offering preferential tariffs for imported components that car assemblers bring into their factories, Mr. Leano said.

“If you invest, you will get incentives,” he said.

The BoI has neither drafted changes to excise taxes levied on imported and locally made cars as this is the prerogative of Congress, Mr. Leano said, without ruling out whether amendments could happen in the future outside of the implementing rules.

In a related development, the Motor Vehicles Parts and Manufacturers Association yesterday reiterated its support for the new MVDP.

“EO 877-A is… just part of an evolving program and merely brings up-to-date and makes relevant the MVDP with the current times,” it said in a statement.

The new program also seeks to increase the market for car firms by further restricting the entry of imported secondhand vehicles, the group said.

“Most of our members have [had] to close shop and those that survive are now operating at only about 40% of rated plant capacities… we have worked long and hard… for the passage of EO 877-A,” it claimed. — J. A. D. Hermosa, Businessworld