The Philippines has taken a step forward in making EV production more attractive for automakers in the country.

President Ferdinand R. Marcos Jr. has signed Executive Order (EO) No. 121, which effectively greenlights the Electric Vehicle Incentive Strategy (EVIS) Program. The initiative aims to boost local manufacturing of electric vehicles (EVs) and attract investments in the country’s automotive industry by providing fiscal incentives for manufacturers that will enroll in the program.

This is very much similar in principle to the Comprehensive Automotive Resurgence Strategy (CARS) Program, where manufacturers will enroll a particular model, part, or component for the program, commit at least PHP 5 billion in capital, meet the 10,000-unit minimum production capacity, and introduce their locally manufactured EV models within three years from registration to qualify.

Manufacturers can register up to two EV models and be eligible to receive two types of incentives - one is through Fixed Investment Support (FIS) to help them establish or expand their manufacturing facilities to make hybrids, plug-in hybrids, and/or EVs, while the other is through Production Volume Incentives (PVI), which gives participants incentives of up to 12 percent of the ex-factory price, capped at PHP 200,000 per locally manufactured vehicle. 

What’s worth noting is that instead of cash subsidies, eligible participants will receive the fiscal incentive through the issuance of non-transferable Tax Payment Certificates, which they can use to settle income tax, value-added tax, excise tax, and import duty obligations to the national government.

An inter-agency committee that consists of the BOI, DBM, DOF, BIR, and BOC has been tasked to establish a digital system for the availment, issuance, and use of the TPCs.

The EVIS Program has a maximum incentive ceiling of PHP 60 billion, with up to PHP 15 billion worth of tax breaks available for each enrolled EV model. This surpasses the PHP 27 billion incentive package of the CARS program launched in 2015 to support local production of internal combustion-powered vehicles.

Mitsubishi Motors Philippines has emerged as the early candidate to participate in the EVIS program, as Mitsubishi Motors Corporation has already committed to a PHP 7 billion investment in the country to locally produce a hybrid electric model.