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LETTER OF INSTRUCTIONS
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LETTER OF INSTRUCTIONS NO. 1355 -
PROVIDING INCENTIVES FOR INTERNAL EXPORTS |
Ministry of Finance, The Central Bank of the
Philippines, The Ministry of Labor and
Employment, The Board of
Investments
WHEREAS, fiscal incentives can be utilized to increase the level of foreign exchange of the country to finance developmental requirements;
WHEREAS, gift giving is a part of the Filipino cultural heritage which is observed by Filipinos by sending or bringing gifts to relatives and friends usually in the form of foreign-manufactured goods;
WHEREAS, Philippine-made products can easily equal if not surpass foreign-made articles;
NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by virtue of the powers vested in me by the Constitution, de hereby declare and instruct the following:
1.
It is hereby declared to be a policy of the state to encourage the
patronage of Philippine made products by providing appropriate
incentives therefor, to Filipinos abroad and other non-residents of the
Philippines, as well as returning overseas Filipinos.
2. Goods paid
for foreign exchange by the above mentioned persons shall be governed
by the following:
a)
Goods assembled or manufactured in the Philippines for household and
personal use, when paid for in convertible foreign currency inwardly
remitted through the banking system in the Philippines, termed as
foreign exchange denominated sales or internal exports, shall be exempt
from the payment of gift taxes and percentage tax on sales under the
National Internal Revenue Code as amended.
b) In order to
ensure effective implementation, the Philippines International Trading
Corporation (PITC) is hereby designated as the implementing agency for
this Program, by way of distributing these products. The PITC will work
with the private sector in pursuing the objectives of this program
subject to the implementing rules and regulations to be prepared by an
Inter-Agency Committee chaired by the Ministry of Trade and Industry,
and composed of the Ministry of Finance, the Central Bank of the
Philippines, Ministry of Labor and Employment, the Board of Investments
and the PITC.
c) The
manufacturers of the goods considered as internal exports shall be
entitled to a tax credit equivalent to the sales, compensating, and
specific taxes and duties on supplies, raw materials and
semi-manufactured products used in the manufacture of the said internal
exports. A provision for standard costing of the products may be
established by the Inter-Agency Committee.
d) The
foregoing fiscal incentives shall, however, apply only to sales not
exceeding an aggregate foreign exchange value of One Thousand United
States Dollars (US $1,000.00) or its equivalent in other convertible
foreign currencies.
4. The Ministry of Trade and Industry, under an International Gift-giving program, is hereby authorized to make available the facilities of its foreign trade services network in the promotion of the products envisioned under this LOI. Moreover, said Ministry shall cause to be published and distributed a catalogue of products to be eligible to participate in such program under such rules and regulations as the Inter-Agency Committee shall adopt and promulgate.
5. Any and all statutes, orders, rules, regulations or parts thereof inconsistent herewith are hereby repealed or modified accordingly.
6. These orders and instructions shall take effect immediately.
Done in the City of Manila, this 24th day of September, in the year of Our Lord, nineteen hundred and eighty-three.
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Since 19.07.98.
