DOF eyes higher taxes on expensive vehicles

The Department of Budget and Management has ordered agencies to “get rid” of luxury vehicles being used for their transport needs while the Department of Finance will move to slap higher taxes on expensive imported cars.

Finance Undersecretary Gil S. Beltran told the House appropriations committee Monday night that the DOF was looking at including additional taxes on luxury cars among the new revenue-generating measures under a comprehensive tax reform package it would pitch to Congress next month.

Beltran later told the Inquirer that the proposal was yet to be finalized and the DOF has yet to determine how much additional revenues could be generated from higher taxes on luxury vehicles, adding that the DOF might also recommend slapping higher taxes on other luxury goods.

Budget Secretary Benjamin E. Diokno, meanwhile, ordered government agencies to refrain from buying and using luxury vehicles.

“The present administration has vowed to be more prudent in the use of public funds. As part of this advocacy, the government should get rid of and abstain from using luxury motor vehicles and make use of transport units with common and simple specifications,” Diokno said in Budget Circular No. 2016-5 issued on Aug. 22.

As such, national government agencies, state universities and colleges, government-owned and -controlled corporations (GOCCs) as well as local government units (LGUs) could only acquire the following body types of motor vehicles: Asian utility vehicle (AUV); assembled owner- or passenger-type jeep/jitney/jeepney bus/mini bus; car (sedan and hatchback); crossover utility vehicle (CUV); heavy equipment; multipurpose vehicle (MPV); passenger van; pick-up, and sport utility vehicle.

Department secretaries and other officials of equivalent rank in national government agencies, GOCCs and LGUs could purchase for official use only either a car (sedan or hatchback) with engine displacement not exceeding 2200 cc for gasoline or 3000 cc for diesel, or an AUV/CUV/MPV with engine displacement not exceeding 2000 cc for gasoline or 2800 cc for diesel.

For the ambassador or chief of mission of Philippine embassies/consulates abroad, they could use only a sedan with engine displacement not exceeding 3500 cc for gasoline or diesel in the country where the embassy/consulate is located.

Department undersecretaries as well as the Chief of Staff of the Armed Forces of the Philippines may choose either a car (sedan or hatchback) with engine displacement not exceeding 1600 cc for gasoline or diesel, or an AUV/MPV with engine displacement not exceeding 2000 cc for gasoline or 2500 cc for diesel.

To transport personnel, equipment, supplies, products and materials, agencies could acquire a passenger van, AUV or MPV in urban areas with good roads; in rural areas, an assembled owner-type jeep or a passenger jeepney-type vehicle, and in remote areas, a motorcycle.

For transport of personnel/visitors for activities related to education, tourism, trade and investment promotions, banking and finance, foreign affairs and other official functions, a passenger van is preferred; for the mass transport of personnel and visitors, agencies should buy either a bus or a mini bus.

Also part of the Duterte administration’s austerity program is Finance Secretary Carlos G. Dominguez III’s directive for the DOF and attached agencies to “refrain from conducting meetings and other work-related events in costly private venues” in Metro Manila and instead use the historic Ayuntamiento de Manila in Intramuros, which currently houses the Bureau of the Treasury.

“Any work-related meeting of the DOF or any of its attached agencies that would be held in a place other than the Ayuntamiento should be justified to me,” the DOF quoted Dominguez as saying in a statement.

“Holding meetings and other work-related functions at the Ayuntamiento is cheaper than organizing them in private venues, which would entail expensive rental fees,” Dominguez noted. -Ben O. de Vera