Customs Issues Tax Guidelines For Used Car Imports

[Mr Lee]

Has anyone ever brought their vehicle to the Philippines? This seems to counteract their wish to get old vehicles off the road, that I posted about HERE. Also, could someone explain the ad valorem tax, is that on top of the first tax? I believe the ad valorem tax is about 20% of the sale value? These taxes seem excessive. CUSTOMS has issued guidelines on the rate of depreciation of diplomatic vehicles and used vehicles to be brought in by returning residents to compute how much to tax them. Administrative Order 5-2011 provides a straight-line depreciation method of 10 percent every year, with a maximum limit of 90 percent of the vehicle’s price.This means a two-year-old vehicle will be assessed a depreciation rate of 20 percent, a three-year old vehicle 30 percent, and so on until the maximum rate of 90 percent of the vehicle’s price is reached.To compute the ad valorem tax on tax-exempt vehicles—where the value is based on the depreciated rate—the depreciation is also 10 percent every year, but the total amount of depreciation may not exceed 50 percent of the vehicle’s original cost or value.The same rule applies to the vehicles of returning residents: a straight-line computation method with an annual depreciation value of 10 percent and a maximum cap of 50 percent.The straight-line rule also applies to imported trucks and heavy equipment: 10-percent depreciation a year but not exceeding the maximum rate of 90 percent.

[Jim Sibbick]

Only 20% is quite generous for Philippines customs duty! I saw a full duty list about a month ago. The rate tops out at 200% of the market value. Only an idiot or an avid collector would pay for a vehicle then pay twice as much again to import it to the Philippines. Ad Valorem just means that a tax is calculated based on the value of the property. The opposite of Ad Valorem is to have a set value for the tax. IE a set tax might be P1000 per vehicle, regardless of the value. Regards: Jim

[FlyAway]

My wife loves her 1991 300ZX. Her first car and she wants to take it to The Philippines one day. So many different rules and regulations change day by day. Also varies by who ever is at the customs desk.

[Mr Lee]

My wife loves her 1991 300ZX. Her first car and she wants to take it to The Philippines one day. So many different rules and regulations change day by day. Also varies by who ever is at the customs desk.

Nice car, I do not blame her for wanting to keep it, and since it is 10 years old, maybe the duties will not be exorbitant, yet I feel we should not have to pay anything but shipping to bring our cars to the country we decide to retire to, because they will then have the benefit of the money we spend in their country. IMO the Philippines really needs to wake up and start making it more desirable and less of a hassle for people to move there. Here is something I found interesting during a search that might help or discourage you. Balikbayans Who wish to bring home Cars to the Philippines 2006-12-18 In reply to queries from many of our kababayans on the procedure for bringing a car into the Philippines, the Philippine Consulate General is pleased to share the following tips from the Bureau of Import Services (BIS) of the Department of Trade and Industry (DTI):Only balikbayans or holders of 13A or 13G Visas are qualified to bring in a used car. 13G visas are given to former Filipino citizens, while 13A visas are issued to foreigners married to Filipino citizens.Only those who have worked or are working and residing abroad for at least one year are allowed to import their personal used cars into the country. This one-year residency requirement can be accumulated over a period of three years.The car must be registered under the name of the importer for at least six months prior to the submission of the application to the BIS.Application forms for prior approval have to be filled out completely and legibly. The forms are available at the Philippine Consulate General in Toronto. They may also be downloaded from the BIS website at http:www.dti.gov.ph/bis.These forms have to be filled out and processed prior to importing a car. Other documents to be submitted include the following:

• Notarized affidavit of undertaking (also available at the Philippine Consulate);
• Authenticated copies of all the pages of your old and new passports, car title or registration;
• Alien Certificate of Registration;
• Immigrant Certificate of Residence;
• 2×2 picture; and
• Payment of the BIS’s processing fee of PhP1,500.00 for cars and PhP900.00 for motorcycles.

With complete documents, processing time is three (3) working days.Not all types of cars are allowed entry. Only left-hand drive vehicles within 3,000 kilos gross weight are allowed.Vehicles must also meet Philippine safety and emission standards.The BIS requires payment of taxes and duties on the imported car and the personal appearance of the importer before the Bureau of Customs can release it.The BIS also advises importers to send their cars to the Manila International Container Terminal (MICT) at the North Harbor. Processing of the entry of imported cars at MICT is easier with the presence of a One-Stop-Action Center.For further questions, please call the Import Action Division of the Bureau of Import Services at tel. no. (632) 890-5418.