The Philippines today announced a PHP60-billion fiscal support package for four electric vehicle (EV) manufacturers that will invest a minimum of PHP5 billion and build the capacity to produce 10,000 EV units annually over the 10-year program.
President Marcos Jr. signed Executive Order No. 121 on July 29, 2026, creating the Electric Vehicle Incentive Strategy (EVIS) Program, which offers targeted tax incentives to investors to encourage the development of an EV manufacturing ecosystem in the country, reduce the country’s dependence on fossil fuels, and help achieve its greenhouse gas emission reduction commitments.
Under EO 121, each participant is required to invest PHP5 billion in the production and assembly of EVs and their parts for up to two EV models under the EVIS Program. An EVIS participant is required to build the capacity to produce 10,000 units annually.
EVIS participants will, in turn, be eligible to avail themselves of the PHP60-billion, incentive fund, or fiscal support, under two mechanisms—the Fixed Investment Support (FIS) and the Production Volume Incentive (PVI).
The FIS is equivalent to the applicable percentage of total capital expenditure used for tooling, equipment, research and development costs, and engineering changes to manufacture the model or platform, including initial start-up expenses and training costs for the start-up operation, excluding land.
This is computed as follows:
- For the domestic manufacture or assembly of enrolled electric passenger vehicles and commercial vehicles: 40 percent for battery EVs; and 30 percent for hybrid EVs, plug-in hybrid EVs, and fuel cell EVs.
- For the domestic manufacture of parts and components for enrolled electric passenger vehicles and commercial vehicles: 40 percent for parts and components for battery EVs; and 30 percent for parts and components for hybrid EVs, plug-in hybrid EVs, and fuel cell EVs.
Meanwhile, the PVI is equivalent to up to 12 percent of the ex-factory unit price, but not exceeding PHP200,000 per unit, for the domestic manufacture or assembly of enrolled electric passenger vehicles and commercial vehicles.
Registered participants shall be entitled to the FIS under the EVIS Program for a maximum of 10 years from the date of registration of the enrolled EV models or their parts and components.
EO 121 also states that the total fiscal support for the EVIS Program allocated to the FIS and PVI shall not exceed PHP60 billion, with each enrolled model qualifying for fiscal support of up to PHP15 billion.
At PHP15 billion in fiscal support per enrolled model, the program is expected to accommodate four registered participants.
The entitlement to the PVI under the EVIS Program for the domestic manufacture or assembly of enrolled EV models shall be subject to compliance with the applicable eligibility criteria, including the manufacture of complete EV units, the manufacture of mandatory parts and components, and a minimum planned production volume or capacity of 10,000 EV units.
The EO also directed the Department of Budget and Management, in coordination with the Board of Investments, to propose in the National Expenditure Program (NEP) the inclusion of the EVIS Program in the annual General Appropriations Act to fund the fiscal support to be granted to registered and eligible participants.
Following the publication of the EO in the Official Gazette, government agencies are expected to craft its implementing rules and regulations.
