REVENUE REGULATIONS NO. 5-2018 issued on January 15, 2018 implements the adjustment of rates on Excise Tax on Automobiles pursuant to the provisions of Republic Act (RA) No. 10963 (Tax Reform for Acceleration and Inclusion [TRAIN] Law), amending for the purpose Revenue Regulations No. 25-2003. Effective January 1, 2018, an Ad Valorem Tax on automobiles shall be levied, assessed and collected based on the manufacturer’s/assembler’s or importer’s selling price, net of Excise and Value-Added Tax, in accordance with the following schedule: NET MANUFACTURER’S PRICE/ IMPORTER’S SELLING PRICE TAX RATE Up to Six Hundred Thousand Pesos (P 600,000.00) Four Percent (4%) Over Six Hundred Thousand Pesos (P 600,000.00) to One Million Pesos (P 1,000,000.00) Ten Percent (10%) Over One Million Pesos (P 1,000,000.00) to Four Million Pesos (P 4,000,000.00) Twenty Percent (20%) Over Four Million Pesos (P 4,000,000.00) Fifty Percent (50%) Provided, that hybrid vehicles shall be taxed at Fifty Percent (50%) of the applicable Excise Tax rates on automobiles subject to the conditions in Section 9(e) of the regulations. Provided, further, that in the case of imported automobiles not for sale, the tax imposed herein shall be based on the total landed value, including transaction value, customs duty and all other charges. Hybrid electric vehicle shall refer to a motor vehicle powered by electric energy, with or without provision for off-vehicle charging, in combination with gasoline, diesel or any other motive power. Provided, that a hybrid electric vehicle must be able to propel itself from a stationary condition using solely electric motor. The removals of locally-manufactured/assembled or release of imported automobiles from the place of production or from customs’ custody, respectively, are exempt from the payment of the appropriate Excise Taxes, subject to certain conditions. Newly-included in the list of tax-exempt removals of automobiles are pick-ups and purely electric vehicles. Prior to the removal of the automobiles from the manufacturing plant or customs custody, the Department of Energy (DOE) shall determine whether the automobiles are hybrid vehicles or purely electric vehicles, and furnish the Commissioner of Internal Revenue (CIR), Attention: Chief, Excise Large Taxpayers Regulatory Division (ELTRD), certified copies of the results of such examination or indorsement to that effect. By the end of three months from the imposition of the new rates, the BIR shall validate the Manufacturer’s or Importer’s Selling Price of the newly-introduced models against the Manufacturer’s or Importer’s Selling Price, and initially determine the correct bracket under which a newly-introduced model shall be classified. After the end of one year from such validation, and every year thereafter, the BIR shall revalidate the initially validated Net Manufacturer’s or Importer’s Selling Price against the Net Manufacturer’s or Importer’s Selling Price as of the time of revalidation in order to finally determine the correct tax bracket under which a newly-introduced model shall be classified. All manufacturers/assemblers or importers are required to file an updated manufacturer’s/assembler’s or importer’s sworn statement for each brand/model of automobiles as of the day immediately before the date of effectivity of these Regulations. The updated manufacturer’s/assembler’s or importer’s sworn statement shall be submitted to the Commissioner of Internal Revenue, Attention: Chief, ELTRD within seven (7) working days from the date of effectivity of these Regulations. All manufacturers/assemblers or importers shall submit a duly notarized list of inventory on-hand of Completely Built-Up (CBU) automobiles, including Completely Knocked-Down (CKD) and Semi-Knocked Down (SKD) units that are located within the manufacturing/assembly plant, storage facility or warehouse or the customs’ premises for which import entries have been filed as of the day immediately before the date of effectivity of these Regulations, indicating therein the brand, year model, engine, body and chassis numbers thereof. The list shall be submitted to the CIR, Attention: Chief, Excise LT Field Operations Division within seven working (7) days from the date of effectivity of these Regulations. Failure to submit the inventory list on the part of the manufacturers/assemblers/importers shall be construed that the said manufacturers/assemblers/importers do not have any inventory on hand of CBUs, CKDs and SKDs as of the day immediately before the date of effectivity of these Regulations.