New Hyundai Veracruz [Merged]

[DocGM]

"Mazdamazda: Yes, that is true... but the tax rate for vehicles is ladderized according to its price. Republic Act 9224 (passed last 2003) states that:


Quote:
importer's selling price up to P600 Thousand 2%
600K to 1.1M P12.000 + 20% of value in excess of P600K
more than 1.1M to 2.1M P112,000 + 40% of value in excess of P1.1M
Over P2.1 Million P512,000 + 60% of value in excess of P2.1M



In layman terms, the higher the vehicle's base selling price, the higher the tax that will be imposed on it.

my *complicated* computation

base price = P1,650,000
base ad valorem tax = P112,000
excess ad valorem tax 40% of P550,000 = P220,000
value added tax = P198,000
cbu tariff fee = P577,500

total = P2,757,000

Now, care for a rebuttal? Doing a direct comparison of US & PH prices will not cut it out."


Dear mazdamazda, thank you very much for the detailed computation you presented to enlighten a lot of our readers in this free forum, of the actual computation of taxation of imported vehicles.

However what most of the readers who disagree with my hypothetical computation misses is the point I have already mentioned.

This computation presented by mazdazazda is for private individuals or grey market dealers bringing in imported vehicles. Not for auto companies who have already invested here in the local scene, who have special tax cuts to the max!

Take the Ford Expedition since it was already mentioned. Initially after the increase of 2,999,000 and only a few purchases, they started to give discounts as high as 250,000 less plus a lot of freebies like give away gas worth 50,000 and comprehensive insurance!

Mitsubishi is now giving 100,000 less for their new Pajero worth 2.6 and 2.5 respectively with also freebies!

The same is true with Hyundai, GM, and some Toyota products!

Don't tell me after these discounts given we are to believe that they still have no profit? Of course they have!

So what am I driving at? These companies have a lot of elbow room to adjust their prices to be reasonable if they really want to, and give us the best deal for the vehicle we want. However they choose not, for certain vehicles.

And we have all the right to demand a reasonable price and quality for products being sold, and not to just accept everything as they want it to be...

By the way, soon after the ratification of the Bilateral trade agreement with Japan, all CBUs imported from that country shall be tax free and a Korean agreement I heard is also following...

So be wary of the prices again, by law and this Philippine-Japan agreement All CBUs should go down drastically... I hope.

[oldblue]

So in essence, what actually HARI is doing as lots of people already said, that they are making a killing in the Philippine market especially to buyers who are not well informed pero dahil nga lang may maraming pera. Syempre, the herd mentality follows. Parang mga buffalo na isa lang ang mag trigger at sasama na lahat kahit bandang huli hulog sa bangin ang resulta.

Tulad ngayon. My cousin in Cebu is telling me that reservation now for the VC is steaming up so seems like the hype is working. First day pa lang raw in the Cebu showroom and the walk-in visitors were told na naka reserve na agad. And what do you think the others would do? They'll start thinking the magics of the VC. They'll say 2.8M is sulit. Just like the Sta. Fe when it was introduced.

wow VC for Cebu. ilang oras lang ba maiikot yan island na yan? are there mountains there as big as the cordilleras or vast plains like Bulacan to La union

sometimes overkill na din etong love ng Pinoys for the SUV.

[oldblue]

So what am I driving at? These companies have a lot of elbow room to adjust their prices to be reasonable if they really want to, and give us the best deal for the vehicle we want. However they choose not, for certain vehicles.

.

kung nasa korte ka and you will rebutt like this, sisigaw lang ni panyero: "speculation" hehehe

[oldblue]

With that convoluted computation, I am not confident that HARI remits the 1.1 million tax to the government... I just have this gut feel that car companies here effect the full taxes in their prices BUT somehow manages not to remit those taxes to the government...

now this is another speculation. napakadali lang bilangin ng BIR nabebenta tsikot in a year as in for all dealers, for all models. even car magazines have access to the data.

hindi ito computer spare parts na mahirap i-monitor.

sa fortuner lang eh, say 3k units sold nationwide last 2006. that's 3k times the tax. very simple.

[mikmik316]

now this is another speculation. napakadali lang bilangin ng BIR nabebenta tsikot in a year as in for all dealers, for all models. even car magazines have access to the data.

hindi ito computer spare parts na mahirap i-monitor.

sa fortuner lang eh, say 3k units sold nationwide last 2006. that's 3k times the tax. very simple.

YES madali lang bilangin ng BIR yun... and YES kahit tayo may access sa data.... BUT I am sure and I BET hindi nila na-reremit yan... dahil kung na-reremit yan dapat top taxpayers ang mga car companies... pero hindi SM ang top tax payer... Kung si Lucio Tan nga kayang lusutan ang Tabacco Taxes e... Car Companies pa? And the batallion of tax lawyers they have they can hide the tax... Mas better sakin na I pay them the vehicle price, I pay the tax to BIR...

[OTEP]

Let's not forget that manufacturers can also artificially lower prices to move unsold units and cut their losses. Just because they cut prices, doesn't mean they are merely removing their profit. It's not as simple as that.

How can they afford to lose money on certain units? Because manufacturers also have other more profitable models/volume sellers.

[DacoTyan]

Let's not forget that manufacturers can also artificially lower prices to move unsold units and cut their losses. Just because they cut prices, doesn't mean they are merely removing their profit. It's not as simple as that.

How can they afford to lose money on certain units? Because manufacturers also have other more profitable models/volume sellers.

Exactly!

As a note, USA has a tough anti-bribery laws that prevents GM and Ford from doing the Tango with the BIR. Of course the law doesn't apply to exploiting gray areas and loop holes in the tax code...

[mambo]

Exactly!

As a note, USA has a tough anti-bribery laws that prevents GM and Ford from doing the Tango with the BIR. Of course the law doesn't apply to exploiting gray areas and loop holes in the tax code...

Did you mean IRS?

[mazdamazda]

This computation presented by mazdazazda is for private individuals or grey market dealers bringing in imported vehicles. Not for auto companies who have already invested here in the local scene, who have special tax cuts to the max!

Tax cuts are applicable most of the time only to income tax & tax credits. Not on the excise tax, vat & customs fee.

Don't tell me after these discounts given we are to believe that they still have no profit? Of course they have!

So what am I driving at? These companies have a lot of elbow room to adjust their prices to be reasonable if they really want to, and give us the best deal for the vehicle we want. However they choose not, for certain vehicles.

And we have all the right to demand a reasonable price and quality for products being sold, and not to just accept everything as they want it to be...

The point is that...

For example, in a mall. A M&S shirt is priced at P1,999.50 during its initial release. The problem is that nobody buys it because it is priced too high or it styling is not that good. M&S then gives a discount during a mallwide sale just to move the inventory and at least to break-even on the said shirt.

If you can't afford a M&S shirt, then just buy Bench or whatever is cheaper or wait for them to offer a discount.

Discounts of imported items are usually only given by the head office as a "subsidy" to move items. In the US, they use rebates for example.

By the way, soon after the ratification of the Bilateral trade agreement with Japan, all CBUs imported from that country shall be tax free and a Korean agreement I heard is also following...

So be wary of the prices again, by law and this Philippine-Japan agreement All CBUs should go down drastically... I hope.

What's your source on this? That's the old proposal which was rejected by the Philippines. Here's the approved JPEPA tariff rates:

For vehicles 3000cc & below, it will be reduced from 29 to 20% by 2009.
For buses, it will be reduced to 0% by 2010.

Under the AFTA, tariff for all vehicles made within SEA will be reduced to 0%.

:fyi:

[DacoTyan]

Did you mean IRS?

Nope I meant Republic of the Philippines, Bureau of Internal Revenue.

The US Foreign Corrupt Practices Act (see http://en.wikipedia.org/wiki/Foreign..._Practices_Act) doesn't allow American companies from, let's say, using bribery to gain business.

As far as American companies, not sure about Japanese, Korean or European laws.