Tax breaks, perks eyed for hybrid car owners

More lawmakers want to grant incentives to car makers who build or import cars that are powered by electric or hybrid engines or those that run on alternative fuel in a move to reduce the country’s dependence on fossil fuel.

The incentives include exemption from excise tax or import duties. Owners of hybrid cars will be exempt from payment of the motor vehicle user’s charge and number coding and will gain priority in the issuance of license plates, according to a proposal now gaining steam at the House of Representatives.

The House committee on ways and means has consolidated several measures on the proposed “Electric, Hybrid and Other Alternative Fuel Vehicles Incentives Act of 2011” seeking to promote the use of alternative sources of energy for automobiles.

The proposal refers to hybrid vehicle as any vehicle that combines the technologies of using internal combustion engine (ICE) with a battery-powered electric motor.

The measure covers electric, hybrid and other alternative fuel vehicles but excludes vehicles powered by gasoline, petroleum, bio-diesel and bio-ethanol. All major carmakers have deveoped their hybrid variants but the commercial success so far belongs to the Toyota Prius, Honda Insight, Nissan Leaf, GM’s Volt and Lexus.

The bill wants the manufacture or assembly of completely-knocked down parts of electric, hybrid and other alternative fuel vehicles to be exempted from the payment of excise taxes and duties for nine years from the effectivity of the law.

The measure also provides the imposition of the value-added tax for the purchase and importation of raw materials, spare parts, components and capital equipment used in the manufacture or assembly of such vehicles shall be suspended for the next nine years from the effectivity of the Act. –Maricel Cruz, Manila Standard Today