Extension of the CARS program still under study
The Department of Trade and Industry (DTI) said it was still assessing whether the government would extend the Comprehensive Automotive Resurgence Strategy (CARS) programme, saying it was awaiting proposals from the private sector.
Speaking to reporters earlier this week, Commerce Undersecretary Ceferino Rodolfo said the matter was under consideration following discussions between them and representatives of the two participating companies, Toyota Motors Philippines Corp ( TMP) and Mitsubishi Motors Philippines Corp (MMPC).
“The [Trade] The secretary met with the two CARS program participants to find out how much time they needed to qualify for a reasonable extension,” Rodolfo said, adding that the two automakers were still finalizing their proposals.
Rodolfo said they expected to see what benefits the two automakers could offer in exchange for extending the deadline to meet the sales volume target.
The two automakers have qualified for incentives under the CARS program, which was signed in 2015, under an agreement under which the two companies will locally produce 200,000 units of the Toyota Vios and Mitsubishi Mirage models over a period six years old.
The Philippine government has allocated 27 billion pesos in tax incentives under the program.
“The DTI fully understands the impact of the pandemic on all industries, especially the automotive industry. Demand has been really hit as well as their supply chain,” the trade manager said.
“We also recognize that participants in the CARS program have already met their investment commitment. So it’s really a matter of not being able to meet their volume commitments due to the market downturn,” he added.
Rodolfo said the previous administration’s previous plan was to extend it for three years, but concerns have been raised about where to “anchor” the extension.
The trade official said it has not been finalized whether the extension will be anchored in the Corporate Recovery and Tax Incentives Act (CREATE) or an executive order of the Board of Investment, l one of the DTI’s investment promotion arms.
On the issue of a third slot under the CARS program, which is aimed at the electric vehicle industry, Rodolfo said they are working on including it in an industry roadmap that they are looking to complete by the first quarter of next year.
“Discussion of the third CARS slot should be in accordance with the EVIDA (Electric Vehicle Industry Development Act),” he said, referring to legislation that became law in April this year. year.
In support of the electric vehicle industry, the National Economic Development and Development Authority said on Thursday it had approved a presidential decree to President Marcos that will implement a zero tariff regime on certain electric vehicles, as well as their parts and components for a period of five years.
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