Section 16Sec./Art. 16

Incentives.- In addition to existing incentives provided by the Board of Investments, the following incentives shall likewise be granted to exporters:

(a) Exemption from Presidential Decree No. 1853, provided that the importation shall be used for the production of goods and services for export.

(b) Importation of machinery and equipment and accompanying spare parts which are used in the manufacture of exported products at zero percent (0%) duty for a period of three (3) years, until 1997.

(c) Tax credit for imported inputs and raw materials primarily used for the production and packaging of export goods, which are not readily available locally, shall be valid for five (5) years:Provided,That the tax credit shall be issued within thirty (30) days from exportation.

(d) Tax credit for increase in current year export revenue computed as follows:

The first 5% increase in annual export revenue over the previous year would mean a credit of 2.5% to be applied on the incremental export revenue converted to pesos at the current rate;

The next 5% increase would be entitled to a credit of 5.0%;

The next 5% increase would be entitled to a credit of 7.5%;

In excess of 15% would be entitled to a credit of 10%.

Such tax credit is only granted for the year when the performance is achieved. Export revenues used in the calculation of such tax credits shall be subject to verification as prescribed under the implementing rules and regulations.

(e) For exporters of non-traditional products who use or substitute locally produced raw materials, capital equipment and/ or spare parts, tax credits equivalent to twenty-five percent (25%) of the duties that would have been paid had these inputs been imported:Provided,That this incentive would be available for a period of three (3) years upon effectivity of this Act and can be extended for another three (3) years by the President upon the recommendation of the Secretary of Finance:Provided, further,That the Secretary of Finance, in consultation with the Export Development Council, shall prepare a list of non-traditional exports which are entitled to avail of this incentive.

Provided, That these incentives shall be granted only upon: (1) the presentation of a Bureau of Export Trade Promotion (BETP) certification of the exporter's eligibility, in compliance with the minimum wage and SSS laws; and that (2) in the case of importations, the items imported shall be used exclusively for production of export goods.

(f) In the interim, while the Eximbank is not yet established government financial institutions (GFIs) including the Development Bank of the Philippines (DBP), the Philippine National Bank (PNB) and the Land Bank of the Philippines (LBP) shall develop within one year, long-term peso and dollar credit facilities to be used for plant and equipment expansion purposes, among others. These credit facilities shall offer preferential and simplified credit schemes to exporters.