Tax incentives for e-motorcycles to boost shift to EVs - expert

MANILA, Philippines: Granting tax incentives to e-motorcycles would result in the reduction of carbon emissions, the Department of Energy (DoE) said on Monday.

DoE science research specialist Andre Reyes said that e-motorcycles are crucial in assisting the country's shift to electric vehicles, since transportation continues to be a major source of carbon emissions.

Reyes was referring to the need to expand Executive Order No. 12 series of 2023, which grants tax breaks to several types of EVs.

Under EO 12, different types of EVs have received tax breaks. However, e-motorcycles are still subject to a 30 percent tariff rate.

«This proposed coverage expansion will send a clear price signal for consumers to switch to EVs, which are more efficient and cheaper to run per kilometer, and assist in energy self-sufficiency,» Reyes said in a public hearing on EO 12 revision.

Data from the DoE showed that using e-motorcycles helps avoid around 8.5 kilograms of carbon dioxide compared to internal combustion engine (ICE) motorcycles.

Using e-motorcycles is also more efficient, as they only cost P0.34 and save 1.72 liters of fuel per kilometer compared to their ICE counterpart, which burns P1.20 per kilometer.

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The energy department wants to increase the country's EV fleet by 50%, or an additional 2.4 million units.

The Statista Research Department said that motorcycles accounted for 7.81 million registered vehicles in the country in 2022, making them the most popular vehicles.

The transportation sector alone was responsible for emitting 35.42 million tons of carbon dioxide in 2022, which contributed to climate change, data from Statista showed.

Stakeholders have been advocating for tax cuts to facilitate the mainstreaming of e-motorcycles, noting their significant contribution to the environment once riders shift to EVs.

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The compulsory review of EO No. 12 rolled out on March 13, a little over a year since the circular was issued.

The Tariff Commission and the National Economic Development Agency are the lead agencies in the review. Recommendations gathered from the public hearings will be submitted to the Office of the President.

EO No. 12 was enacted to