JEWELRY INDUSTRY DEVELOPMENT ACT OF 1998

Case Overview and Summary

Summary of the Jewelry Industry Development Act of 1998

Objectives and Policy (Section 2):
- Promote the development of small and medium-scale jewelry industries
- Generate employment, enhance tax collection, increase industry linkages, and increase foreign exchange earnings
- Encourage local jewelers to join the formal sector by providing support and a conducive business environment
- Adopt tax incentives and programs for the growth of the industry
- Promote and institutionalize the participation of jewelry industry associations and cooperatives

Development Incentives (Section 3):
- Zero duty on imported raw materials, including precious metals, gems, stones, jewelry parts, accessories, and supplies (Section 3a)
- Exemption from excise tax on jewelry, pearls, precious and semi-precious stones, and imitations thereof (Section 3b)
- Zero duty on imported capital equipment, spare parts, and toolings (Section 3c)
- Additional 50% deduction from taxable income for expenses incurred in approved training schemes (Section 3d)
- Gold and silver sales by Bangko Sentral ng Pilipinas to jewelry enterprises with minimal margins (Section 3e)
- Authority for jewelry enterprises to buy gold and silver directly from other sources (Section 3f)
- Inclusion of locally-manufactured jewelry in government tourist duty-free shops, including promotion, advertisement, and sale (Section 3g)
- Eligibility for incentives provided by other special laws, such as the Export Development Act of 1994, Special Economic Zone Act of 1995, and BOI Omnibus Investments Code, for export-oriented activities without double availment (Section 3h)

Eligibility and Registration (Section 4):
- Jewelry enterprises must be duly registered with appropriate government agencies to qualify for assistance, counseling, and incentives
- Definition of jewelry enterprise: engaged in any aspect of manufacturing goods known as fine and imitation jewelry, including producing, cutting, polishing, shaping, refining, forming, or fabricating real or imitation pearls, precious and semi-precious stones, imitations thereof, goods made of precious metals and imitations, and other raw materials and parts used in jewelry manufacturing

Implementation and Monitoring (Section 5):
- The Department of Trade and Industry shall monitor, oversee, supervise, and take responsibility for the implementation of this Act
- The Department of Trade and Industry shall submit a yearly report to Congress

Implementing Rules and Regulations (Section 6):
- The Secretary of Trade and Industry shall promulgate the implementing rules and regulations within 30 days from the approval of this Act, upon prior consultation with the Secretary of Finance

Separability Clause (Section 7):
- If any provision is declared unconstitutional, the remaining provisions not affected shall remain in full force and effect

Repealing Clause (Section 8):
- The second paragraph of subSec. "q" of Sec. 105 of the Tariff and Customs Code of the Philippines, and other inconsistent laws, executive orders, rules, and regulations are repealed or modified accordingly

Effectivity (Section 9):
- This Act shall take effect 15 days after its publication in two newspapers of general circulation