MANILA - A senator said on Thursday that the VAT on electric vehicles may need to be suspended to make them more affordable.

Senator Sherwin Gatchalian said while tariffs on EVs have already been suspended for 5 years, more incentives may be needed to entice more Filipinos to go electric.

“Tax provisions should be revisited again at least in the short term. For example, VAT is 12 percent. Pag tinanggal mo ang VAT, napakalaking bawas yun sa presyo. Maybe we can have VAT refund for electric vehicles in the short term lang,” said Gatchalian.

President Ferdinand Marcos Jr. earlier said he wanted to bring the EV market share to 50 percent by 2040.

The Electric Vehicle Association of the Philippines meanwhile said it aims to have 6.6 million electric vehicles (EVs) on the road by 2030.

But Gatchalian said the RA 11697 or the Electric Vehicle Industry Development Act which became law last year should be fully implemented to hit the target.

The said law also provides incentives to electric vehicle owners. It also mandated government agencies and private companies to have EVs comprise at least 5 percent of their fleet. EV users are also entitled to dedicated parking slots, charging stations and more.

During the opening of the Philippine Electric Vehicle Summit in Pasay, Gatchalian said there's a need for more EV facilities in the country.

“Pagpunta mo sa mall, walang charging station. Pagpunta mo sa office, walang charging station. Pag babyahe ka papuntang Baguio, along the way walang charging station,” said Gatchalian, principal author of the law.

Despite the setbacks, EVAP President Edmund Araga said they are confident of hitting their target even if their 2022 data shows there are only 15,300 EV units in the country.

But Araga clarified, they're banking on the rise in the usage of electric motorcycles as it is more affordable to Filipinos.

The Department of Energy is also helping push for the use of electric vehicles. Director Patrick Aquino answered a query on why Filipinos should buy EVs when the Philippines has among the highest power rates in Asia. There is also an issue on power supply in the country.

But Aquino said the government is helping build more renewable energy power plants. With more RE in the power mix, that could lead to lower power costs in the future.

Aquino added that based on their study, it is actually cheaper to operate an EV.

“Nasa under P2/km ang cost to operate ng isang electric vehicle kung ikukumpara mo sa isang internal combustion engine, gasoline o diesel, na nasa P4 mahigit, mahigit P5,” said Aquino.

Dozens of companies are now exhibiting at the Philippine Electric Vehicle Summit, most parts and units are imported.

The price range of a car would be from around P600,000 to P5 million. EVAP’s goal is to manufacture these cars, and more importantly, batteries, here in the Philippines to bring down costs.