Section 45Republic Act No. 7611., Sec./Art. 45

Incentives. -

(a) Rewards, monetary or otherwise, shall be provided to individuals, private organizations and entitles, including non-government organizations, that have undertaken outstanding and innovative projects, technologies, processes and techniques or activities in re-use, recycling and reduction. Said rewards shall be sourced from the Fund herein created.

(b) An incentive scheme is hereby provided for the purpose of encouraging LGUs, enterprises, or private entities, including NGOs, to develop or undertake an effective solid waste management, or actively participate in any program geared towards the promotion thereof as provided for in this Act.

(1) Fiscal Incentives. - Consistent with the provisions of E.O. 226, otherwise known as the Omnibus Investments Code, the following tax incentives shall be granted:

(a) Tax and Duty Exemption on Imported Capital Equipment and Vehicles - Within ten (10) years upon effectively of this Act, LGUs, enterprises or private entities shall enjoy tax and duty free importation of machinery, equipment, vehicles and spare parts used for collection, transportation, segregation, recycling, re-use and composing of solid wastes: Provided, That the importation of such machinery, equipment, vehicle and spare parts shall comply with the following conditions:

(i) They are not manufactured domestically in sufficient quantity, of comparable quality and at reasonable prices;

(ii) They are reasonably needed and will be used actually, directly and exclusively for the above mentioned activities;

(iii) The approval of the Board of Investment (BOI) of the DTI for the importation of such machinery, equipment, vehicle and spare parts.

Provided, further, That the sale, transfer or disposition of such machinery, equipment, vehicle and spare parts, without prior approval of the (BOI), within five (5) years from the date of acquisition shall be prohibited, otherwise, the LGU concerned, enterprise or private entities and the vendee, transferee, or assignee shall be solidarily liable to pay twice the amount of tax and duty exemption given it.

(b) Tax Credit on Domestic Equipment - Within ten (10) years from the effectivity of this Act, a tax credit equivalent to 50% of the value of the national internal revenue taxes and customs duties that would have been waived on the machinery, equipment, vehicle and spare parts, had these items been imported shall be given to enterprises, private entities, including NGOs, subject to the same conditions and prohibition cited in the preceding paragraph.

(c) Tax and Duty Exemption of Donations, Legacies and Gift - All legacies, gifts and donations to LGUs, enterprises or private entities, including NGOs, for the support and maintenance of the program for effective solid waste management shall be exempt from all internal revenue taxes and customs duties, and shall be deductible in full from the gross income of the donor for income tax purposes.

(2) Non-Fiscal Incentives. - LGUs, enterprises or private entities availing of tax incentives under this Act shall also be entitled to applicable non-fiscal incentives provided for under E.O. 226, otherwise known as the Omnibus Investments Code.

The Commission shall provide incentives to businesses and industries that are engaged in the recycling of wastes and which are registered with the Commission and have been issued ECCs in accordance with the guidelines established by the Commission. Such incentives shall include simplified procedures for the importation of equipment, spare parts, new materials, and supplies, and for the export of processed products.

(3) Financial Assistance Program. - Government financial institutions such as the Development Bank of the Philippines (DBP), Landbank of the Philippines (LBP), Government Service Insurance System (GSIS), and such other government institutions providing financial services shall, in accordance with and to the extent allowed by the enabling provisions of their respective charters or applicable laws, accord high priority to extend financial services to individuals, enterprises, or private entities engaged in solid waste management.

(4) Extension of Grants to LGUs. - Provinces, cities and municipalities whose solid waste management plans have been duly approved by the Commission or who have been commended by the Commission for adopting innovative solid waste management programs may be entitled to receive grants for the purpose of developing their technical capacities toward actively participating in the program for effectively and sustainable solid waste management.

(5) Incentives to Host LGUs. - Local government units who host common waste management facilities shall be entitled to incentives.

CHAPTER V

FINANCING SOLID WASTE MANAGEMENT