Amending Certain Sections Of Republic Act No. 3470, As Amended, Entitled "An Act Creating The National Cottage Industries Development Authority (Nacida), Under The Department Of Commerce An

MALACAÑANG
M a n i l a

PRESIDENTIAL DECREE No. 817 October 22, 1975

AMENDING CERTAIN SECTIONS OF REPUBLIC ACT NO. 3470, AS AMENDED, ENTITLED "AN ACT CREATING THE NATIONAL COTTAGE INDUSTRIES DEVELOPMENT AUTHORITY (NACIDA), UNDER THE DEPARTMENT OF COMMERCE AND INDUSTRY, PRESCRIBING ITS DUTIES, POWERS AND FUNCTIONS, AND APPROPRIATING FUNDS THEREFOR"

WHEREAS, there is an imperative need to amend the NACIDA Law in order to update its provisions and make it attuned with the modern trends in the production and trading of cottage industry products;

WHEREAS, cottage industry products now ranks as the No. 6 dollar earner among the commodity exports of the nation and deserve to be accorded more incentives for growth and viability;

WHEREAS, it is necessary to encourage the establishment and promotion of cottage industries in order to generate more employment opportunities.

NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by virtue of the powers in me vested by the Constitution, do hereby decree and order the amendment of Republic Act No. 3470, as...

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Summary of Presidential Decree No. 817

Amending the National Cottage Industries Development Authority (NACIDA) Law

Board of Directors and Administration:
- The President shall create the NACIDA Board under the Department of Trade, composed of a Chairman and three members, one from the private sector. (Section 1)
- The Chairman and members shall have a term of six years, with per diems and allowances specified. (Section 1)
- An Administrator and Deputy Administrator shall be appointed with specified salaries. (Section 1)
- The Board shall fix compensation and number of officers and employees, approve budgets, administer the revolving marketing fund, and enunciate policies. (Section 3)

Powers and Functions:
- NACIDA shall promote standardization of cottage industry products and prescribe rules for grading, classifying, and inspecting, especially for exports. (Section 2)
- NACIDA shall establish an Accreditation Committee to regulate and supervise activities related to cottage products or raw materials. (Section 2)

Regional Institutes and Managers:
- Regional Cottage Industries Institutes shall be headed by Cottage Industries Managers and Assistant Managers with specified salaries. (Section 4)

Definition of Cottage Industry:
- Cottage industry is an economic activity carried on at home or elsewhere for profit, with capitalization not exceeding P100,000 at registration. (Section 5)
- It includes various crafts, agricultural tools, toys, embroidery, weaving, machine parts, poultry, piggery, food preservation, and other home-based industries. (Section 5)
- Cottage industries must be owned and operated by Filipino citizens or corporations/partnerships with at least 75% Filipino ownership. (Section 5)

Tax Exemptions:
- Cottage industry products shall be exempt from all taxes except specific and income taxes for five years from registration, with conditions. (Section 6)
- 75% of raw materials must be of Philippine origin, except for certain industries. (Section 6)
- No exemption from percentage taxes on sales exceeding P400,000 per year. (Section 6)
- Provisions on cooperatives shall not be affected. (Section 6)

Funding:
- Necessary funds shall be appropriated from the National Treasury and included in the annual General Appropriations Decree. (Section 7)

Repealing Clause and Effectivity:
- Inconsistent laws, decrees, rules, and regulations are repealed or modified accordingly. (Section 8)
- The Decree shall take effect immediately. (Section 9)