MANILA — The head of the House of Representatives’ tax-writing panel has introduced a bill seeking to hike excise taxes on luxury vehicles, private aircraft, and yachts to raise billions for state programs, while eliminating levies on perfumes.
House Ways and Means Committee Chairman Miro Quimbo filed House Bill 11465, which targets high-value discretionary purchases.
Under the proposed measure, luxury vehicles priced between P4 million and P8 million would face a 50 percent ad valorem tax, while those costing above P8 million would be taxed at 75 percent. Rates for vehicles priced at P4 million and below would remain unchanged.
The automotive tax adjustment is projected to generate an additional P3.91 billion in annual revenue to fund priority government projects.
"The proposed measure aims to achieve greater tax progressivity and promote a more equitable distribution of wealth since luxury and high-value goods are generally purchased by consumers with greater disposable income," Quimbo said.
The bill also increases the excise tax on non-essential goods from 20 percent to 25 percent, explicitly expanding coverage to include yachts, jet skis, speedboats, private jets, and helicopters acquired for sport or pleasure.
"This measure would enable the Government to tap revenue sources that are readily identifiable and administratively accessible, while ensuring that goods and assets used for essential, livelihood, public transportation, or productive sources are not unduly burdened,” Quimbo added.
In contrast, the measure removes perfumes and toilet waters from the non-essential goods tax list. Quimbo noted the legislation taps readily identifiable wealth without imposing new burdens on essential goods or public transport.
The administration of President Ferdinand Marcos Jr. has promised to raise the income tax exemption threshold in a bid to ease the burden on workers amid rising inflation. To make up for the lost revenues, the government has been looking at raising the tax rates for other goods, including sweetened beverages.