Marikina 2nd District Rep. Miro Quimbo has filed a bill seeking higher excise taxes on luxury automobiles and other non-essential goods, while proposing to remove perfumes and toilet waters from the list of taxable products.
House Bill 11465 seeks to amend Sections 149 and 150 of the National Internal Revenue Code and introduce higher tax rates for high-value discretionary purchases. The measure remains a proposal and would still need to pass Congress before becoming law.
Under the bill, automobiles priced above P4 million up to P8 million would face a 50% ad valorem excise tax, while vehicles priced above P8 million would be taxed at 75%. Cars priced at P4 million and below would retain their existing rates, including the current 4%, 10% and 20% brackets.
Quimbo, who chairs the House Ways and Means Committee, estimates that the higher automobile taxes could generate about P3.91 billion in additional annual government revenue. He said the proposal is intended to place a larger tax burden on high-value discretionary consumption while avoiding additional taxes on ordinary and essential goods.
The proposal would also increase the excise tax on non-essential goods from 20% to 25%. The expanded coverage would specifically include luxury recreational assets such as yachts, jet skis, speedboats, sailboats, motorboats, private aircraft, planes, jets and helicopters acquired for pleasure, private use or sport.
Ordinary passenger vehicles, motorcycles and commercial vehicles such as trucks and cargo vans would not be covered by the proposed increase in the non-essential-goods tax. The bill is focused on what it defines as a narrower segment of high-value luxury consumption.
At the same time, HB 11465 would remove perfumes and toilet waters from the list of products subject to the Section 150 excise tax. This would effectively shift the proposed tax emphasis away from personal-care products and toward higher-value recreational and luxury assets.
The proposal follows a broader government discussion about restructuring excise taxes on luxury and non-essential consumption. The Department of Finance had earlier floated similar measures, including a 25% tax on non-essential goods and higher rates for automobiles costing P8 million or more, as part of efforts to raise revenue and make the tax structure more progressive.
The bill’s passage could therefore affect the pricing of high-end vehicles, recreational vessels and private aircraft if Congress approves the proposed rates. For the government, the measure could provide an additional revenue stream while leaving existing tax rates on lower-priced vehicles unchanged.
The proposal now enters the congressional legislative process, where its tax rates, coverage and potential impact on consumers and government revenue will be subject to further deliberation and possible amendments.
