An OFW (Overseas Filipino Worker) has a privilege to ship his used car to the Philippines. However, it could be costly. Here is an overview of about sending a used car to the Philippines.
The cost lines of sending used cars to Philippines include:
- Shipping cost from country of origin to Philippines
- Philippine Customs Taxes and Duties
- Non-customs charges, eg. storage and arraste fees
Shipping costs from country of origin would vary. For example, shipping a car from the UAE according to SkyFreight Cargo is estimated at UAE AED 20,000 – AED 23,000, or more than PhP250,000 as of May 2016 (Check Skyfreight Cargo UAE’s notes here.
Philippine Customs Taxes and Duties
On arrival to the Philippines, an imported used car is subject to:
- 40% Customs duty,
- 10% VAT and from
- 15% to 100% Ad Valorem Tax depending on its piston displacement.
That is around 65% to 150% X the book value of the shipped used car. BOC will advise the actual taxes and duties.
The tax base is the book value identified from universally accepted motor vehicle reference books such as the Red Book, Blue Book, World Book depending on the origin of the imported vehicle.
Depreciation is computed on 10% per year. Current year has a depreciation rate of zero percent (0%). Motor vehicles with a piston displacement of 2000 cc and above may be given a maximum depreciation of 50%, while those below 2000 cc, up to the maximum of 70%.
Other Non-Customs Charges
These may include charges such as storage and arrastre fees which may be collected by the privately-owned arrastre operator; by the shipping line and wharfage dues by the Philippine Ports Authority (PPA).
Who can ship used motor vehicles to the Philippines?
- Returning Resident- a Filipino citizen who has stayed in a foreign country for at least one (1) year and which residency shall be accumulated within the three (3) year period immediately preceding the date of filing of the application.
- Immigrant-a person issued any of the following types of visa under the Philippine Immigration Act of 1940,as amended:
- A Filipino citizen and a holder of 13G Visa under Sec.13, Sub g(13g);or
- A foreign national married to a Filipino and a holder of 13A Visa under Sec.13,Sub a (13a);
- A Filipino citizen and holder of 47A and 47A2 issued to awardees of Special Government Project/s (SPG).e.g. Philippine Retirement Authority and Balik-Scientist Program.
Other conditions to qualify a used vehicle for Philippine importation
- The vehicle has a gross vehicle weight not exceeding three tons;
- It is covered by an authority to import (Certificate of Authority to Import) issued under the No-Dollar Importation Program by the Bureau of Import Services (BIS) ;
- It is personally owned and registered under the name of a returning resident or immigrant at least six (6) months prior to the date of application for permit to import with the BIS ;
- It is for personal use;
- It cannot be resold for at least three (3) years.
- Motor vehicle should be left-hand drive.
- Personal presence by the car-owner of the used motor vehicle is required.
Spare parts sent with the motor vehicle are taxed separately.
Importation of used cars into the Philippines requires a Prior Import Authority, otherwise it could seized and be subject to hefty fines. An application form is to be submitted to the Bureau of Import Services along with the following documents duly authenticated by the nearest Philippine Consulate abroad where the car-owner resides:
- Proof of his continuous stay abroad for at least one (1) year;
- Copy of the registration papers showing that the vehicle is registered in his name for at least six (6) months;
- Proof that the car was acquired out of the earnings abroad.
For more information about importation of used cars into the Philippines, here is the link to the Bureau of Customs website: BOC .
To ship or not to ship
With all the expected costs, is importing one’s used vehicle to the Philippines recommended? Probably not a popular decision for most, unless otherwise, the car has an underlying value very personal in nature to the owner.