House of Representatives (Ellson Quismorio/ MANILA BULLETIN)




The proposed Motor Vehicle Road Users’ Tax (MVRUT) law, one of the priority measures mentioned by President Ferdinand "Bongbong" Marcos Jr. in his second State of the Nation Address (SONA), has been approved at the committee level. Albay 2nd district Rep. Joey Salceda, chairman of the House Committee on Ways and Means, said the approved measure, embodied in House Bill (HB) No.376, will raise more funds for public transport modernization, while reducing rates for vehicles for-hire and exempting motorcycles and tricycles from the charge. Salceda is the principal author of HB No.376, which seeks to amend Republic Act (RA) No. 8794 or the Motor Vehicle User’s Charge--enacted more than 20 years ago--and instead impose an MVRUT. “The bill is based on the MVRUT bill passed on third and final reading in the 18th Congress, after thorough deliberation and consultation with stakeholders and industry experts by our committee," he said. "The bill is also part of the priorities of the Development Budget Coordination Committee (DBCC), estimating that this will result in almost P151 billion from 2024 to 2027 to the government,” Salceda added. The proposal intends to raise some P274.45 billion over the next five years. The approved proposal also earmarks 45 percent of incremental revenues to the private utility vehicle (PUV) modernization program, and 5 percent for road crash prevention programs. President Marcos delivered his SONA on Monday afternoon, July 24 during a joint session of Congress in the House of Representatives. The Salceda committee convened to tackle and pass  HB No.376 the next day. “As a backgrounder, the President has the authority to adjust the MVUC rates annually as stipulated in RA No. 8794. However, since the enactment of the law, the MVUC rates were only adjusted once in 2004 and have not been adjusted for inflation for the past 19 years. “So, actually, it takes courage from Congress to undertake this, but it’s Congress, as representatives of the people, who would be in a better position to decide these things,” Salceda explained. HB No.376 was actually filed way back on June 30, 2022, the first day of the 19th Congress For-hire vehicles will get a 50 percent discount from their MVUC payments, while motorcycles and tricycles, will be exempt. “As envisioned, the earmarking for PUV modernization will be enough for equity subsidy of P500,000 per unit of PUV,” Salceda added. According to estimates from the Department of Finance (DOF), “The implementation of the MVUC reform will have minimal impact on public transport fares in 2024” of between seven to 42 cents. The DOF added that the “proposal would also result to minimal impact on inflation at 0.068 percentage points in 2024".