EconomyEditor's PickIsuzu PHL seeks delay of excise tax imposition on pickups

January 22, 2023

By Revin Mikhael D. Ochave

ISUZU PHILIPPINES CORP. (IPC) is asking for more time before the proposed removal of excise tax exemption on double-cab pickup trucks, saying that the segment is primarily used by local businesses.

IPC Assistant Division Head for Sales Robert D. Carlos told in an interview at the sidelines of a company event in Manila City last week that the lead time will help the automaker plan ahead if the proposal pushes through. The IPC’s local double-cab pickup offering is the D-Max.

Despite the request, Mr. Carlos reiterated that IPC remains supportive of the government’s efforts to improve the economic state of the country.

“We fully support the government in its plans and programs for the betterment of the country. With regard to the plan of implementation of excise tax on pickup trucks, we are requesting for consideration and lead time,” Mr. Carlos said.

“We request to review our appeal because pickup trucks are primarily designed for utilitarian purposes, as a business tool designed with an open bed intended to transport cargo. It is actually classified under the N1 Category, which refers to vehicles used for the carriage of goods,” he added.

In August last year, the House Ways and Means Committee approved the fourth package of the Comprehensive Tax Reform Program, which incorporated the removal of the excise tax exemption on pickup trucks. The Department of Finance (DoF) previously pushed for the removal of the excise tax exemption on double-cab pickups under Republic Act No. 10963 or the Tax Reform for Acceleration and Inclusion (TRAIN) Law.

According to the DoF, the removal of the excise tax exemption enjoyed by pickup trucks is expected to generate P52.6 billion worth of additional revenues for the government from 2022 to 2026.

Trade Secretary Alfredo E. Pascual previously expressed his support for the DoF’s proposal, saying that an imported double-cab pickup truck is typically a “fully-accessorized passenger unit.”

The Chamber of Automotive Manufacturers of the Philippines, Inc. (CAMPI) previously voiced its opposition to the proposed removal of excise tax exemption for pickups, arguing that it would hurt the recovery of the local vehicle industry.

“Many are using pickups, since these are for business. We are concerned about the addition of the taxes… We express concern,” CAMPI President Rommel R. Gutierrez previously said.

IPC HAS A NEW PRESIDENTMeanwhile, IPC officially welcomed Tetsuya Fujita as its new president during turnover ceremonies held in Manila City last week. Mr. Fujita succeeded outgoing IPC President Noboru Murakami.

Mr. Fujita previously served as the chairman and chief executive officer of Isuzu Motors de Mexico from 2020 to 2021. He was previously the general manager for sales of Isuzu Motors International Operations Thailand in Bangkok from 2014 to 2017, and corporate planning manager of Isuzu Commercial Truck of America in California, USA from 2005 to 2010.

During his speech. Mr. Fujita vowed to maintain the position of IPC as the leading truck brand in the Philippines. “As I accept the IPC presidency, I also accept the challenge of ensuring that our long reign as the number-one truck brand will be maintained, as well as our good relationship with our customers and business partners,” he said.

“As the leading truck brand in the industry, we will continue innovating new products that will assist in the progress of the country while displaying more responsibility to the society and the environment through our Road to Progress vision,” the executive added.

On the other hand, IPC said that outgoing IPC President Mr. Murakami will be transferred to Isuzu North America Corp.

“With the truck market there getting quite aggressive, Isuzu Motors Limited considered me fit to oversee their operations,” Mr. Murakami said in his speech at the event.

Based on CAMPI figures, the IPC ranked sixth in terms of overall sales among car brands in 2022 after it recorded 17,639 units sold, equivalent to a 5% market share. The local automotive industry sold a total of 352,596 units in 2022, up 31.3% versus 268,488 units sold in 2021. The figures also showed that IPC’s 2022 sales figure reflected a 22.3% increase from the 14,424 units sold in 2021.

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