Escalante City Tax Ordinance No. 021-03

January 30, 2003 Excerpts from the Minutes of the Regular Session of the Sangguniang Panlungsod of the City of Escalante, Held on Thursday, January 30, 2003 at the Legislative Building at 2:20 in the Afternoon. ESCALANTE CITY TAX ORDINANCE NO. 021-03 AN ORDINANCE ENACTING THE REVISED INVESTMENT CODE OF THE CITY OF ESCALANTE BE ORDAINED by the Sangguniang Panlungsod of the City of Escalante; CHAPTER I Title and Declaration of Policy SECTION 1. This Ordinance shall be known as the ESCALANTE INVESTMENT CODE OF 2003. SECTION 2. Declaration of Policy. It is hereby declared the policy of the City Government of Escalante, Negros Occidental to provide a business environment conducive to investment and to attract and encourage the establishment of enterprises, both foreign and local, for the purpose of accelerating its socio-economic development. CHAPTER II Definition of Terms SECTION 3. Definition of Terms. For purposes of this Code, the following terms and phrases shall mean as follows: Board refers to the Investment Incentives Board of Escalante created under this code. Code refers to the Investment Incentives Code of Escalante. Local Investment means an investment made by a resident or non-resident Filipino investor, (whether single proprietorship, partnership, corporation or cooperative; in the form of cash and other assets actually put into the project. HDIaST Existing Firm/Establishment refers to a firm or establishment whose place of operation is presently located within the city of Escalante prior to the enactment of the Code. Foreign Investment means an equity investment made in the form of a foreign exchange or other assets actually transferred or invested in Escalante by a non-Filipino. City refers to the City of Escalante and covering all areas within its territorial jurisdiction. National Laws refers to decrees and executive orders issued by the Office of the President, and all acts passed by Congress. New Enterprise refers to an investment or establishment which is not engaged in any type of business in Escalante at the time the Code was enacted. Preferred Areas of Investment means the economic activities that the Board shall identify, approve and declare as such after thorough study and evaluation. Project Study refers to a study which presents the financial, socio-economic, marketing and technical aspects of the project. Registered Enterprises means enterprises or businesses registered in accordance with the provisions of this Code. CHAPTER III Investment Board SECTION 4. Investment Board of Escalante. There shall be created the Investment Promotions Board of Escalante (IPBE) for the purpose of implementing the provisions of this Code. SECTION 5. Composition of the Board. The Board shall be composed of the following: a. City Mayor Chairman and Presiding Officer b. City Planning and Development Coordinator c. Provincial Director of the DTI or his representative d. Two (2) representatives from the duly accredited Civil Society Organizations (CSOs) and another two (2) from the private sector organizations who are nominated by their group and appointed by the City Mayor. e. Chairpersons of the SP Committees on Finance and Appropriations, and Trade and Industry. SECTION 6. Meeting of the Board. The Board shall meet at least once a month or as often as deemed necessary by the Chairman or by the majority of the members. The majority of the members shall constitute a quorum. DaHcAS SECTION 7. Powers and Duties of the Board. The Board shall be vested with the following powers and duties: a. Implement the rules and regulations of this CODE; b. Prepare the list of preferred areas of investments in consultation with the Private Sector Organizations; c. Process and act on application for incentive availment; d. Grant incentives to qualified investor applicants; e. Decide controversies regarding interpretation and implementation of this Code; f. Check and verify the compliance by registered enterprises; g. Cancel or suspend availment of incentive given, and/or require refund of incentives enjoyed by an investor who has violated the provisions of this code; h. Render annual report to the Sangguniang Panlungsod; i. Exercise all powers necessary or incidental to attain the purpose of this Code. SECTION 8. Functions and Powers of the Chairman. a. To preside over the meetings of the Board; b. To approve the application for the availment of incentives by applicants evaluated and found qualified by the Board; c. To recommend to the Board such policies and measures he may deem necessary to carry out the objectives of this Code; and d. To exercise other powers and perform other duties as may be prescribed by the Board. CHAPTER IV Incentives for Investors Eligible under National Laws SECTION 9. Investors Enjoying Incentives under National Laws. a. Investors enjoying incentives under RA 7844, RA 7916, RA 7718, and RA 3289 shall be exempt from the following: 1. Payment of building permit fees, city business taxes and other fees and charges for a maximum period of five (5) years from the date of approval by the Board. ACcTDS 2. Payment of real property tax on improvements for a maximum period of five (5) years. b. Investors enjoying incentives under E.O. 226, otherwise known as the Omnibus Investment Code (OIC) of 1987 shall be exempted from payment of the fees and taxes as enumerated under a and b above, for a maximum period of four (4) years for non-pioneer and five (5) years for pioneer industries. c. In both cases under Sections 9 and 10, investors must show compliance with all requirements under existing national and local laws or guidelines issued by accrediting agencies, and present the Certificate of Registration showing the grant of incentives by the appropriate national agency. The applicability of the City incentive shall not extend beyond the period of incentive granted in the Certificate of Registration issued by the national agency. Fees paid prior to approval of incentives availment under this chapter shall not be subject to refund. Neither shall exemptions granted include fees and taxes already accrued prior to the application. CHAPTER V Incentives for Preferred Investments and Others SECTION 10. Coverage. This chapter grants incentives to investors in preferred investments, investors under expansion and diversification, and investors under non-preferred investments. SECTION 11. Incentives. Investors that meet the capital and employment generation requirements shall be exempt from: a. Payment of building permit fees, business fees and taxes, and other fees and charges for a maximum period of five (5) years from the date of approval of application by the Board. b. Payment of real property tax on new improvement for a maximum period of five (5) years from the date of approval of the application by the Board. In the case of an existing improvement, the exemption shall apply only to the increases in the assessment because of rehabilitation, adaptation, expansion, or introduction of equipment/machineries. SECTION 12. Investors under Preferred Investments. The incentives in Section 11 shall be available to those investing in new projects under the preferred areas of investments listed below, to wit: a. Manufacture of agro-based products such as but not limited to: 1.) Processed food and Beverages 2.) Sweets, candies and condiments 3.) Cutflower production ScTaEA b. Manufacture of various products such as but not limited to: 1.) Toys 2.) Ceramics 3.) Furnitures 4.) Garments, shoes, bags, belts 5.) Electricals and electronics 6.) Packaging materials c. Tourism-related business such as but not limited to: 1.) Hotels and pension houses 2.) Beach and mountain resorts 3.) Recreational parks, restaurants and marina d. Property development projects such as but not limited to: 1.) Commercial complexes 2.) Office buildings 3.) Residential areas development 4.) Convention centers 5.) Private industrial estates 6.) Retirement Villages 7.) Economic Zones 8.) Memorial parks 9.) Irrigation and dams 10.) Agricultural food terminals 11.) Harvest and storage facilities 12.) Hospitals/Health Care Services e. Transhipment facilities such as but not limited to: 1.) Airport and seaport infrastructure and expansion 2.) Common bonded warehouses 3.) Shipping facilities TACEDI 4.) Ship building/ship breaking/ship repair/dry docking facilities f. Power projects: 1.) Power generation 2.) Power transmission g. Metal fabrication and foundry shops/Machine shops/Printing Press SECTION 12. (A) Addition of Preferred Areas of Investment. The Board may add, subject to the approval of the Sangguniang Panlungsod, any area of investment, provided that it must: a. Generate high levels of employment; b. Feature a high degree of value-added; c. Create linkages with local-industries; and d. Be environmentally friendly. SECTION 12. (B) Removal of a Preferred Investment Area. The Board may likewise remove, subject to the approval of the Sangguniang Panlungsod, any area from the aforecited list, if: a. Sufficient investment in the area has been attained. b. The continued extension of incentives may result to unfavorable business climate, or is no longer to the interest of the city. c. The area does not attract investors within a reasonable length of time, or may result in an unfavorable business climate. SECTION 12. (C) Capitalization and Employment Generation Requirements, Period of Exemption for Preferred Investments. To qualify for incentives, an investor under this category must comply with the following requirements: For Local Investor: Capitalization Employment No. of years of Generation Exemption P1.5 Million to P15M at least 5 workers 3 Over P15M to P60M at least 20 workers 4 Over P60M up at least 50 workers 5 For Foreign Investor: Capitalization Employment No. of years of Generation Exemption $75,000.00-$500,000.00 at least 10 workers 3 Over $500,000.00 to $1.5M at least 20 workers 4 Over $1.5M at least 50 workers 5 SECTION 13. Additional Incentives for Investors. under preferred Investments. Investors under preferred investments shall enjoy additional number of years of exemption under the following conditions: a. Employment Generation: Employment Additional Year Generated of Exemption 70 to 120 workers 1 120 workers and above 2 b. Relocation of Principal Office. An investor who shall relocate his/her principal office to the city shall be granted one additional year of Incentives. SECTION 14. Incentives under Non-Preferred Investment. Investors under this category may avail of the incentives in Section 11 under the following conditions. Capitalization Employment No. of years of Exemption P1.5M to P10M at least 20 1 workers Over P10M to P30M at least 30 2 workers Over P30M to P50M at least 40 3 workers Over P50M to P100M at least 50 4 workers Over P100M at least 60 5 workers CHAPTER VI Other Incentives SECTION 15. Tax Credit for Persons Donating Property to the City. Persons donating land, property, or money to the City for their priority projects shall be entitled to tax credit, which can be used to pay tax obligations to the City Government. Priority projects contemplated herein include but are not limited to: housing projects, resort projects, public markets, bus terminals, health projects, educational institutions, scholarships, government centers, and sports facilities; STDEcA SECTION 15. (A) Basis of Tax Credit. The amount of tax credit shall be 10% of the fair market value of the property as determined by the Office of the City Assessor; SECTION 15. (B) Rules of Donation. The following rules shall govern the donation: a. The prospective donor shall submit to the Board through the Investment Promotions Center, his/her intent to donate. b. The Board determines whether the prospective donation qualifies for the tax credit under this chapter. The Board shall then pass a resolution approving or disapproving the donation. c. The Board shall submit the resolution approving the grant of incentive together with the deed of donation to the Sanggunian for ratification. d. The donor shall avail of the tax credits within five (5) years from the date the donation is approved by the Sanggunian. SECTION 16. Provision of Infrastructure Support. The City shall provide infrastructure support, such as the construction/improvement of access roads and bridges, including the provision of power and water for all investments eligible for incentives under this Code. SECTION 17. Miscellaneous Support. The City shall provide manpower/technical trainings to respond to the skills requirements of a business enterprises qualified for incentives under this Code. It shall likewise assist/mediate in the settlement of labor disputes. CHAPTER VII Requirements, Application, Approval Process, and Renewal SECTION 18. Requirements. For firms to enjoy the incentives under the Code, they must comply with the following. a. Period for filing of applications Applications for incentives under Chapter IV and V may be filed before the start of construction or commencement of business operations but in no case later than six months after commencement of business operations. b. Requirements common to Single Proprietorships, Partnership, Corporations, and Cooperatives : 1. Three (3) copies of completed application form available from the Investment Promotions Center. 2. Business plan of the proposed investment (prescribed form available from the Investment Promotions Center). CIaHDc 3. A certified copy of the Certificate of Business Name Registration from the Department of Trade and Industry, or the EC or ODA registration. 4. A certification from the City Treasurer that the applicant has no outstanding obligation with the City. 5. Certificate of Registration if enjoying incentives under the National Laws. c. Additional requirements for Partnership, Corporation, and Cooperatives : 1. Authority from the partnership or Board of Directors to file application 2. Partnership or incorporation documents 3. Cooperative Development Authority documents in the case of cooperatives d. Proof of compliance with the pertinent provisions of Sections 12 to 17 as to capitalization, employment generation, nature of investment, and project or business location, as the case may be. SECTION 19. Application, Evaluation and Approval. a. Time for filing of applications Applications must be filed within the period provided in Section 18 (a). b. Venue for filing of applications All applications shall be filed with the Local Investment Board through the Investment Promotions Center under the Mayor's Office. c. Filing Fee A non-refundable filing fee of two thousand pesos (P2,000.00) shall be paid to the City Treasurer. d. Processing Time The Board shall act upon applications within thirty (30) working days from official acceptance. e. Procedure for Filing, Processing/Evaluation and Approval . 1. The head or senior staff of the Center provides pre-counselling/advice to prospective applicants as to the various provisions of the Code. 2. The Center issues a checklist of requirements and forms for the applicant to accomplish. 3. The applicant presents all the required documents to the Center. 4. If the Center determines that the documents submitted are complete, it requires the applicant to pay the non-refundable filing fee of Two Thousand Pesos (P2,000.00). TIEHDC 5. The Center accepts the application and supporting documents, indicating the date of acceptance and official receipt number in the application form and in the Application and Registration Book. 6. The Center forwards the application and its Evaluation Report and Recommendation to the Board, through the chairperson. The Board shall deliberate and decide on the application. 7. The Center records the approval or disapproval of the Board in the Application and Registration Book. 8. The Center informs the applicant of the decision of the Board, and if the application is approved, requires payment of the filing fee as provided in Section 19 hereof. 9. The Certificate of Eligibility is issued and the business is registered as an eligible enterprise. SECTION 20. Renewal. Renewal of a Certificate of Registration shall be done within the first quarter, but not later than February 15, of every fiscal year. CHAPTER VIII Annual Registration Fee SECTION 21. The Approved Eligible Enterprise shall pay a one-time registration fee as follows: A. Local Investment Investment Cost Registration Fee P1.5 Million-P5 Million P7,000.00 Over P5 Million-P10 Million P12,000.00 Over P10 Million-P20 Million P15,000.00 Over P20 Million-P35 Million P20,000.00 Over P35 Million-P60 Million P30,000.00 Over P60 Million P30,000.00 plus P3,000.00 for every P10 Million in excess of P60 Million B. Foreign Investment $75,000 to $300,000.00 Amount equivalent to the and above registration fee in pesos at the current rate of exchange and an additional of THREE THOUSAND PESOS ONLY (P3,000.00) for every $50,000 in excess of $300,000.00 CHAPTER IX Certificate of Eligibility SECTION 22. Certificate of Eligibility. A qualified enterprise under this Code shall be issued a Certificate of Eligibility with the signature of the Chairperson and/or such other officers as the Board may designate for the purpose. The Certificate shall be in such form and style as the Board may determine and shall state among others, the following: CTEaDc a. The name of the eligible enterprise. b. The area of investments that the eligible enterprise will engage in. c. Such terms and conditions as should be complied with by the eligible enterprise to continue to qualify for incentives during the period granted in its Certificate of Eligibility. CHAPTER X Submission of Reports and Other Documents SECTION 23. Submission of Reports and Other Documents. Every registered eligible enterprise shall submit to the Board through the Center the following reports and/or documents within the time prescribed: a. Amendment of Articles of Incorporation and by-laws, or Articles of Partnership, or Articles of Cooperation, within thirty (30) calendar days from the date of approval of said amendments by the Securities and Exchange Commission or Cooperative Development Authority; b. Change of Directors within 30 calendar days from the change; c. Report on alien officers or employees within 30 calendar days from the date of registration or from the appointment of their aliens/replacements. Provided, that such aliens are registered as such with the Bureau of Immigration and Deportation (BID) and with the Department of Labor and Employment (DOLE); d. Report on employment of bonafide Escalante City residents within 30 calendar days from the date of registration as eligible enterprise and/or from the appointment of their replacements; and every semester thereafter. e. Quarterly report on business operations including production or gross sales or receipts, to be submitted within 30 calendar days from the end of each quarter. f. Audited Annual Financial Statements with the Bureau of Internal Revenue (BIR) stamp acknowledging receipt, within 30 calendar days after submission of the same to the Bureau of Internal Revenue (BIR), but not later than 30 calendar days after the deadline for filing such Audited statements with the BIR. CHAPTER XI Investment Promotions Center SECTION 24. Investment Promotions Center. The IPBE shall establish an Investment Promotions Center with adequate personnel and budget for personal services, operation and maintenance, equipment, promotions, and other needs. The Center shall perform the following functions: CTacSE a. Provide pre-counselling/advice to prospective applicants and answer their inquiries. b. Receive applications of firms/establishments seeking to avail of incentives under this code. c. Evaluate applications on the basic of documents submitted. The Center shall forward complete applications of qualified investors to the Board, otherwise it shall inform applicants of the rejection of their applications and the reason/s therefore. d. In the event the application is approved by the Board, furnish to the City Treasurer and city Assessor, copies of the Board resolution granting incentives and Certificate of Eligibility, for their information and guidance in the implementation thereof. e. Have custody and responsibility for filing and safekeeping of all records and documents. f. Provide administrative and secretariat services to the Board. g. Facilitate the issuance of business permits of registered eligible enterprises. h. To conduct ocular inspection of the premises or examination of the business activity of any enterprise, including the records and books of any enterprise, registered or applying for registration (at any reasonable time of the day, during office hours) for verification or ascertaining, the enterprise's strict compliance with the provisions of the Code. i. Receive required reports and other documents from registered eligible firms. j. When appropriate, as when a registered business has violated the Code, recommend the cancellation or revocation of the Certificate of Eligibility and withdrawal of all incentives granted. k. Assist the Board in promotional aspect of the Code and perform such other functions and responsibilities as may be authorized. CHAPTER XII Appropriations SECTION 25. Appropriations. The city shall appropriate the annual funding requirements necessary for the implementation of this code based on the yearly budget presented by the Board. CHAPTER XIII Final Provisions SECTION 26. Penal Clause. Any violation of the provision of the Code, existing laws, ordinances, rules and regulations, shall be a ground for the cancellation or revocation of the registration of business and the withdrawal of all incentives granted under this Code. ECSaAc a. The Certificate of Eligibility, as provided under this Code, may be cancelled or revoked due to the following: 1. Violation of any provision of the Code. 2. Violation of existing local and national laws, ordinances, rules and regulations. 3. Failure to commence actual project development within one (1) year from registration. b. Cancellation or revocation of the Certificate of Eligibility shall mean the withdrawal of all incentives granted under this Code; and all fees and charges previously exempted shall become due and demandable. c. Upon the recommendation of the Board, the Chairman may cancel or revoke the Certificate of Eligibility of the concerned business enterprise through a formal written notice to that effect, and shall become effective on the 16th day from receipt thereof. SECTION 27. Appeal. An applicant adversely affected by any decision may within 15 days from receipt of such decision, appeal the same to the Board whose decision shall be final and executory. SECTION 28. Separability Clause. The provisions of this Code are hereby declared separable. The invalidity of one or more provisions shall not affect the validity of the other provisions thereof. SECTION 29. Repealing Clause. All ordinances, Executive Orders and Rules and Regulations inconsistent with the provisions of this Code are hereby repealed. SECTION 30. Effectivity. This Code shall take effect upon its approval. Unanimously Enacted by eight (8) members present. I HEREBY CERTIFY TO THE CORRECTNESS OF THE FOREGOING ORDINANCE WHICH WAS FINALLY ENACTED DURING THE REGULAR SESSION HELD ON JANUARY 30, 2003. FRANCISCO PIOS, JR. Secretary to the SP ATTESTED AND CERTIFIED TO BE DULY ENACTED: ADOLFO E. MAGUATE Vice Mayor APPROVED: __________, 2003 SANTIAGO G. BARCELONA, JR. City Mayor <vanguardsforchange.com/images/lifestyle/tax_ordinance.pdf> last visited May 20, 2014.