Imposing an Additional 10% Sales Tax on Imported Airconditioning Units, Components and Parts

EXECUTIVE ORDER NO. 507 July 14, 1978

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...

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Summary of Executive Order No. 507

Imposition of Additional 10% Sales Tax on Imported Airconditioning Units, Components and Parts
- An additional 10% sales tax shall be levied, assessed and collected on imported airconditioning units, components and parts. (Section 1)
- This additional 10% sales tax is on top of the existing 25% sales tax imposed under Sections 196 and 193(b) of the National Internal Revenue Code. (Section 1)
- The additional 10% sales tax shall be collected at the same time and in the same manner as the existing 25% sales tax. (Section 1)

Definition of "Imported" Airconditioning Units, Components and Parts
- All airconditioning units not certified by the Board of Investments as "locally manufactured" shall be deemed as imported. (Section 2)
- All imported airconditioning components and parts, except those of common and general use, and those specifically authorized for import under the local content or rationalization program of the Board of Investments for the airconditioning industry, shall be subject to the additional 10% sales tax. (Section 2)

Effectivity
- This Executive Order shall take effect immediately. (Section 3)