The US Congress just passed House Resolution (HR) No. 1  or the One Big Beautiful Bill Act (BBB) recommending the termination of the federal tax credits for new clean vehicle, restricting eligibility for clean vehicle tax incentives, and imposing of a 3.5% excise tax on overseas remittances sent by non-US citizens.

The BBB was sponsored and introduced by Representative Jodey Arrington on 20 May 2025 and was subsequently passed in the House on 22 May 2025. The bill is currently being deliberated in the US Senate, which could pass it by 04 July 2025.

Relevant provisions of the BBB that may affect the Philippines are the following:

Section: 112002 – Termination of Clean Vehicle Credit

Under the current law, US taxpayers can claim a tax credit up to USD 7,500 for a new “clean” vehicles usually referred as electric vehicle (EV) in the US. This tax credit applies to vans, SUVs, and pick-up trucks with a manufacturer’s suggested retail price (MSRP) of at least USD 80,000 and other clean vehicles with an (MSRP) of USD 55,000. The tax credit is set to expire on 31 December 2032. However, if BBB will be passed, the incentive will be terminated by 31 December 2025. Further, only manufacturers that have not sold 200,000 units of new clean vehicles can qualify for the tax credit.

Section 112003 – Termination of qualified commercial clean vehicle credit

Under the current law, US taxpayers can claim a tax credit up to USD 7,500 for a clean commercial vehicles that was placed in service within the year. Clean commercial vehicles that are less than 14,000 pounds in weight can claim the USD 7,500 in tax credit while those weighing more can claim up to USD 40,000. This incentive was set to expire on 31 December 2032. However, under this section of the BBB, it will accelerate the expiration date to 12 May  2025. Only clean commercial vehicles  that were ordered or purchased on or before 12 May 2025 will be eligible to said tax credit.

Section 112105 – Excise Tax on remittance transfer

Under the current law, there is no excise tax on overseas remittance in the US. Under the BBB however, a 3.5% excise tax on said remittance will be imposed. The excise tax only applies to non-US citizen and will be collected by the remittance companies on each transaction.

Noting that the Philippines is part of the EV supply chain, the BBB’s proposed changes may have an effect on the demand for the country’s green metals that feed in to the EV supply chain in the US. 

The DTI advises all relevant industries and stakeholders—particularly those involved in EV manufacturing, supply chain operations, and financial services—to consider conducting an early assessment of potential impacts and prepare appropriate risk mitigation strategies.

For questions and clarifications, please contact Philippine Trade and Investment Center- Washington, DC at washington@dti.gov.ph and/or the DTI-EMB Market Division at marketdivision@dti.gov.ph.