Press Release
September 4, 2018

Recto: Suspend "third of triple whammy" that will hit motorists

Government was urged to freeze its plan to raise motor vehicle (MV) registration fees as it could be the third of the "triple whammy" against owners of 10.4 million vehicles in the country who are still reeling from higher taxes on oil and cars.

Compounding the two TRAIN-imposed tax hikes "is the rising prices of oil and there's no end yet on when and by how much it will peak," Senate President Pro Tempore Ralph Recto said.

Another fourth factor that argues against any immediate hike in MV registration rates, Recto added, is the worsening traffic in Metro Manila, Metro Cebu and other major urban areas.

"When motorists are buying more expensive gas and spending more time on the road to reach shorter distances, then clearly it is not the right time to further jack up the cost of vehicle ownership," Recto said.

Because of these, Recto said government should freeze its plan to adjust Motor Vehicle User's Charge (MVUC) rates, or popularly known as road user's tax, under Republic Act No. 8794.

RA 8794 authorizes the President to adjust registration rates once every five years using the annual inflation rates as ceiling although no Malacañang occupant since the law was passed in 2001 had exercised that option.

The other route is for Congress to pass a law imposing new rates, "but this road is closed because I don't think anyone in the House or in the Senate wants to do this now."

The MVUC varies according to type of vehicle, its use, weight and age.

It has also proven to be a rich cash cow for the government, "with total collections reaching P167.7 billion from 2001 to June 2018," Recto said.

The rise in its collections mirrors the increase in the number of vehicles, with collections hitting P12.8 billion in 2016, to P14.1 billion in 2017 and P8.8 billion in the first half of the year.

Despite the increase, spending has been put on hold for more than a year now, Recto said, which DPWH Secretary Mark Villar confirmed before senators on Aug. 8.

"Kung walang plow back sa mga motorista, ano ang biyaya nila dito? Nasaan ang dividends in terms of better roads, safe streets, and better lighted highways? Dirty, dilapidated, dark pa rin ang maraming kalsada?" Recto said.

Under RA 8794, 80 percent collections are constituted into a Special Road Support Fund, 5 percent into a Special Local Road Fund, 7.5 percent into a Special Vehicle Pollution Control Fund, and 7.5 percent into Special Road Safety Fund.

The Commission on Audit in a special audit report flagged irregularities in the use of MVUC collections.

In one year alone, in 2013, the audit body discovered that use of P1.7 billion in funds of the Road Board, the agency created by law to administer MVUC Fund, was marked by irregularities.

News Latest News Feed