Toyota Motor Philippines Corp. is preparing to avail of at least P2.7 billion in tax incentives under the Comprehensive Automotive Resurgence Strategy program, after locally producing over 100,000 vehicles as of October 2021, a top executive said Wednesday.
“We are now entitled to avail of the incentives. We hit 100,000 units last October 2021. We are now processing for the availment,” said TMP first vice president for corporate affairs Rommel Gutierrez.
He said the company would formalize the availment of incentives through the Board of Investments.
Under the CARS program, participating car companies like TMP can obtain up to P9 billion in fiscal and non-fiscal incentives for producing at least 200,000 of the enrolled vehicle model. In the case of Toyota, its enrolled vehicle is the Vios.
The production vehicle incentives kick in after a participant is able to deliver 100,101 units to the program.
Toyota so far received part of the fixed incentive support for its P3.2-billion investment in large parts manufacturing.
The fiscal support will come in the form of tax payment certificates. Participants can use the certificates in offsetting their tax and duty obligations to the government, specifically excise tax, income tax, import duties and value-added tax.
Under the program, continued support is provided to the parts manufacturing activities of the participants. It also allows for the outsourcing of parts to be owned by the registered carmaker.
The CARS program is a result of the Industry Roadmapping Project launched by the BOI in 2012. Under Executive Order No. 182, the thrust of the program is to provide time-bound and output or performance-based fiscal support to attract strategic investments in the manufacturing of motor vehicles and parts.
Other non-fiscal measures provided by existing laws continue to be in place and are being implemented by relevant government agencies.
Total fiscal support for the duration of the CARS Program is P27 billion, with each enrolled model qualified to a fiscal support of up to P9 billion, subject to an Automotive Development Fund.
Participants of the CARS program will have to comply with performance-based terms and conditions including the minimum output of 200,000 units over the six-year program period and local production of body shell and large plastic parts.
Aside from TMP, the only other participant in the CARS program is Mitsubishi Motor Philippines Corp.