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Toyota cheers tax break for hybrids

Toyota cheers tax break for hybrids


The protracted debate over whether hybrid electric vehicles (EV) should be entitled to tax breaks has ended with the Marcos administration’s decision to extend the zero-tariff policy under Executive Order No. 12 to these vehicles, as well as e-motorcycles and e-bicycles.

EO 12 which President Marcos signed in January last year slashed import duties on electric vehicles to zero until 2028, from 5 to 30 percent.

Perhaps no company is happier about this development than Toyota Motor Philippines (TMP), which dominates the hybrid e-vehicle market.

As Josephine Villanueva, first vice president for Corporate Affairs of TMP, said: “We welcome the EO.”

No surprise there as out of the 5,518 electrified vehicles sold by the industry in the first four months, 3,869 were hybrid vehicles bearing the Toyota and Lexus brands, based on data from the Chamber of Automotive Manufacturers of the Philippines.

With the tax-free entry, it stands to reason that sales of these hybrid vehicles—which are gaining ground among those who want to be greener but do not want to deal with “range anxiety” from using fully electric vehicles – will accelerate with the prospect of friendlier prices.

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Initially, hybrid vehicles – which use both an internal combustion engine and an electric motor for propulsion– were not included, apparently due to the strong lobby among those who want the EO to be confined to full EVs.

But with the recently approved EO, hybrid believers can chalk up a major policy win for their camp.