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EXECUTIVE ORDERS
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EXECUTIVE ORDER NO. 280 - EXPANDING
THE INCENTIVE FEATURES OF LETTER OF INSTRUCTIONS (LOI) NO. 1352 DATED
SEPTEMBER 8, 1983 TO ENCOURAGE CRUDE OIL EXPORT PROCESSING ACTIVITIES
IN THE COUNTRY BY INCLUDING THEREIN INTERMEDIATE PRODUCTS FOR
FEEDSTOCKS AND AUTHORIZING THE SWAP OR EXCHANGE OF PETROLEUM PRODUCTS,
THEREBY AMENDING LOI NO. 1352, AND FOR OTHER PURPOSES
WHEREAS,
there is a recognized need and a definite advantage to the national
economy to promote and facilitate the export processing of
foreign-owned crude oil, as well as the processing of own imported
crude oil for export by local oil refineries, so as to increase foreign
exchange earnings from unused refinery capacity and make the local
refineries more competitive with those of other countries in the region;
WHEREAS, the tax incentives under Letter of Instructions (LOI) No. 1352
dated September 8, 1983 have proven to be inadequate, and there is,
therefore, a need to revise and improve, the existing tax incentive
scheme for foreign-owned crude oil export processing in the country;
WHEREAS, to attract foreign crude oil owners to enter into processing
arrangement with local refineries and to improve the viability of such
processing arrangement, as well as the export sales of petroleum
products, it is necessary to include intermediate products for
feedstocks within the contemplation of crude oil export processing
activities, and to authorize petroleum product swap or exchange
arrangements.
NOW, THEREFORE, I, CORAZON C. AQUINO, President of the Philippines, do
hereby order:
Section 1.
“1.
“Local oil companies may process
additional volumes of their own imported crude oil to exploit export
opportunities for petroleum products as they occur.”
Sec. 2.
“5-A.
“For purposes of such product
swaps/exchanges, the petroleum products to be actually exported by the
foreign entity/affiliate after the swap/ exchange shall be deemed to be
the processing yield, results for the crude oil brought into the
country by the foreign entity/affiliate, as certified to by the Energy
Regulatory Board.
“The petroleum products received
in swap/exchange by the local oil company, if these are intended for
local sale, shall be subject to applicable excise taxes, fees, charges,
and other imposts, except customs duties and other import charges and
fees since they have already been paid by the local oil company on
their products given in swap/exchange. However, the subsequent export
of said swapped/exchanged petroleum products by the local oil company
shall continue to be given the same tax/ duty treatment accorded to
other petroleum product exports, thereby allowing recovery by the local
oil company of the import duties, charges imposts and other fees paid
on its products given in swap/exchange. The local oil companies shall
be allowed to recover the excise taxes on refinery fuel and loss
volumes, that may have been paid in the case of products given in
swap/exchange which were taken or lifted from tax paid stocks.
Sec. 3.
Sec. 4.
Sec. 5.
Sec. 6.
Sec. 7.
DONE in the City of Manila,
this 25th day of July, in the year of Our Lord, nineteen hundred and
eighty-seven.
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