MANILA - The government is studying the imposition of excise taxes on new vehicles to raise revenues and to manage vehicle volume on major roads, House deputy speaker Rolando Andaya Jr. said Monday.

Andaya said it might be better to purchase a vehicle now because the excise tax would raise costs of up to P400,000 to P600,000.

"By way of plain talk, mas mabuti siguro kung bumili na ng kotse ngayon para makatipid ka," he said.

("By way of plain talk, it might be better to buy a vehicle now because it is cheaper.")

House ways and means committee chairman Dakila Carlo Cua likewise said the proposal is in part "a reaction also to the traffic crisis."

"But kung mapasa nga po itong excise sa automobile na proposed ng DOF or not, it will affect definitely the prices of vehicles," he said.

("But if the excise tax proposal on automobile is passed, it will affect definitely the prices of vehicles.")

Cua explained that the excise tax rate will be implemented in tiers depending on the price of the vehicle. He said the tax won't be imposed on secondhand cars.

However, Cua said he is not 100 percent sold on the proposal, but it is worth studying.

"If you ask me, I do not 100 percent subscribe to that notion because this issue is limited to the urban areas like Metro Manila, Cebu and a few other parts of the country. In places like Quirino or maybe Mindoro, traffic is not much of a problem. So we would like also for the people who are in the provinces to have the option to purchase a vehicle at an affordable package," he said.

House deputy speaker Raneo Abu, on the other hand, welcomed the proposal.

"Dahil ang lagi kong iniisip talaga, kahit na tayo ay magparami ng magparami ng kalye kung hindi naman natin ire-regulate 'yung pagbili ng sasakyan, ganya’t ganyan pa rin ang problema natin," he said.

("I always say, even if we build more roads, if vehicle sales aren't regulated, we will have the same problem.")

Cua said the Department of Finance (DOF) met with the House ways and means panel last week to work on the counter-proposals of the Lower House to the comprehensive tax reform plan of the government.

Cua declined to go into details, but said one improvement recommended is the adoption of efficiency measures in revenue collection like the adoption of a real time point of sale system which will plug loopholes.

"We believe that if that’s done real time, maraming mapa-plug na loopholes sa tax administration," he said.

("We believe that if that’s done real time, there will be a lot of loopholes in the tax administration that will be addressed.")

VAT ON SENIORS

Cua added that the panel also asked the finance department to work on tightening the regime for the exemptions to the value-added tax on senior citizens, noting that the government stands to earn a measly P6 billion to P10 billion from revoking the privilege.

"Pinag-aralan lang kung magkano ba ang impact nun at gaano ka-material ba," he said.

("We are studying how big of an impact it will make.")

"Kasi napaka-liit ng economic impact ng amount, P6 billion to P10 billion annually is not going to make a dent in our revenue generation. So, mas mabuti pang pigilan na lang 'yung mga pag-aabuso nung privilege na 'yun," he added.

("It has a small economic impact, P6 billion to P10 billion annually is not going to make a dent in our revenue generation. So, it's better if those who abuse the privilege is stopped.")

EXCISE TAX ON OIL

Cua said the DOF was also asked to present its detailed study on the impact of excise taxes on oil especially in terms of the cost of business.

He said the excise tax on fuel is expected to raise as much as P180 billion for government, which would be enough to compensate the revenues that will be foregone with the reduction of income tax rates.

"Ang pinaka-malaking revenue source na sa kanilang package is the excise on petroleum which they estimated around P180 billion a year. So 'yun ang pinaka, kumbaga panakip dun sa mawawalang revenue because of the lowering of the income taxes," he said.

("The biggest revenue source in the package is the excise on petroleum which they estimated around P180 billion a year. That will cover lost revenues from the lowering of the income taxes.")

The panel is also studying the grant of a tax amnesty, said Cua, adding that the DOF is working on its tax proposals as fast as possible.

The administration hopes to finish the comprehensive tax plan at the committee level before year and, making it possible to pass it into law within the first half of 2016.

Meanwhile, Andaya doesn't expect any major changes to the proposed 2017 budget. The budget will be up for a vote on third and final reading this week.

"There are some areas which need to be improved upon and there will be amendments proposed along the way even up to the bicam level. That is much being anticipated at this point in time," he said.

The House is still processing the individual amendments being sought by congressmen before the final vote. The Senate will take up the budget after the House approves it.

Andaya wants the Executive to explain how it will fund the increases in the salaries of cops and soldiers as well as other uniformed personnel.

"We just have to rely on their word at this point in time. We haven't had the formal explanation on the matter. Let's put it that way," he said.