Road user tax might hike by 300% in next 3 years

A proposed law by the Department of Finance (DOF) could increase motorists’ road user tax by as much as 300 percent over the next three years. 

The road user tax is being collected in the form of higher annual vehicle registration fees by the government from millions of motorists.

In a report by The STAR, the DOF is proposing that road user levy would be increased by P1.40 for next year, P1.95 for 2021, and P2.50 for 2022.

Under the proposed law, the tax will be based on the gross vehicle weight, plus its cargo and/or passengers ferried, which would be determined by the Land Transportation Office (LTO), according to The STAR.

In order to determine the amount, the owner would have to multiply the vehicle’s gross weight to the DOF’s proposed motor vehicle users charge.

(GVW x MVUC = DOF-proposed rates)

For example, an owner paid P2,040 in road user tax in 2018 for a 2014 Toyota Hilux pickup. This includes the registration fee, plus P50 for stickers, P10 as contribution to the LTO’s “legal research fund” along with a computer fee of P169.06.

Basing on the vehicle’s certificate of registration, the Hilux has a gross weight of 2,755 kilos or almost 2.8 tons and a “net capacity” of 1,378 kilos or 1.4 tons. However, it is not clear if this is what the DOF would be referring to as the cargo and/or passenger carry capacity.

Using the proposed rates by the DOF, the owner of the Hilux would have to pay a road user tax of P3,857 for next year, P5,372.25 for 2021, and P6,887.50 in 2022. That sum excludes the miscellaneous fees along with the additional levy for the vehicle’s load-bearing capacity.

The DOF is proposing that the rates be uniform to all types of vehicles old or new.

LTO’s record showed that there were 11.6 million registered vehicles as of 2018, 1.2 million higher compared to 10.4 million in 2017. – With Jess Diaz/STAR

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