Publishing Executive Order No. 507

August 9, 1978 REVENUE MEMORANDUM CIRCULAR NO. 074-78 SUBJECT : Publishing Executive Order No. 507 TO : All Internal Revenue Officers and Others Concerned For the information and guidance of all concerned, there is published below the full text of Executive Order No. 507 which imposes an additional ten per cent (10%) sales tax on imported airconditioning units, components and parts. Malacaang Manila "EXECUTIVE ORDER NO. 507 "IMPOSING AN ADDITIONAL 10% SALES TAX ON IMPORTED AIRCONDITIONING UNITS, COMPONENTS AND PARTS "WHEREAS, local manufacturers of airconditioning units, components and parts are registered under an existing local content program of the Board of Investments; "WHEREAS, the Board of Investments have determined, thru a yearly review of local capability, the components which can be locally manufactured, and have required their manufacture and/or use, in lieu of imported components, by existing assemblers; "WHEREAS, these assemblers have invested time and money to manufacture these components; "WHEREAS, it is unfair to treat them, taxwise, as importers or mere assemblers of said product out of imported components; "WHEREAS, to protect our local airconditioning industry, a tax differential for locally manufactured and imported airconditioning units, components and parts must be restored. "NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by virtue of the powers vested in me by the Constitution and by Section 193(c) of Presidential Decree No. 1358, do hereby order as follows: "Sec. 1. There shall be levied, assessed and collected an additional ten (10%) per cent sales tax on imported airconditioning units, components and parts, which shall be in addition to the twenty-five (25%) per cent sales tax imposed under Section 196 and Section 193(b) of the National Internal Revenue Code, as amended, and shall be collected at the same time and in the same manner. "Sec. 2. For purposes of the additional ten (10%) per cent sales tax herein imposed, all airconditioning units which have not been certified by the Board of Investments as 'locally manufactured' shall be deemed to be imported. All imported airconditioning components and parts other than those which are of common and general use and those which are specifically authorized to be imported under the local content or rationalization program of the Board of Investments for the airconditioning industry, shall likewise be subject to the additional ten (10%) per cent sales tax. "Sec. 3. This Executive Order shall take effect immediately. "Done in the City of Manila, this 14th day of July, in the Year of Our Lord, Nineteen Hundred and Seventy-Eight. "(SGD.) FERDINAND E. MARCOS President of the Philippines" Features of the Executive Order Under this Executive Order imported airconditioning units, components and parts are levied a ten (10%) per cent sales tax in addition to the twenty-five (25%) per cent sales tax imposed under Section 196 and Section 193(b) of the National Internal Revenue Code, as amended, thus making a total sales tax of thirty-five (35%) per cent. For purposes of the additional ten (10%) per cent sales tax imposed under the Executive Order, the following are deemed imported: 1. All airconditioning units which have not been certified by the Board of Investments as "locally manufactured"; and 2. All imported airconditioning components and parts, except: (a) Those which are of common or general use; and (b) Those which are specifically authorize to be imported under the local content or rationalization program of the Board of Investments for the airconditioning industry. aisa dc All internal revenue officers and others concerned are hereby enjoined to be guided accordingly and to give this circular as wide a publicity as possible. EFREN I. PLANA Acting Commissioner