Finance Secretary Carlos Dominguez III has approved the Bureau of Customs (BOC) implementing rules and regulations (IRR) on tax- and duty-free importation of certain goods aimed at boosting the Philippines’ healthcare capacity against COVID-19.
The IRR also includes provisions to facilitate “blended” or online learning system amid this global health crisis, the Department of Finance (DOF) said in a statement.
Customs Administrative Order (CAO) No. 12-2020 establishes the compliance system for importers and manufacturers entitled to avail exemption from import taxes, duties and fees as set under Republic Act (RA) No. 11494 or the Bayanihan to Recover as One Act (Bayanihan 2).
The CAO details the products, equipment and supplies covered by the tax exemption under Bayanihan 2. On top of medical supplies, tax-exempt goods now include personal computers, laptops, tablets, or similar equipment appropriate for use in schools and donated for distribution to public schools, including state universities and colleges and vocational institutions under the Technical Education and Skills Development Authority.
The tax exemptions are effective until December 19, 2020.
The CAO further specifies operational procedures and regulatory clearances that importers or manufacturers need to comply with to avail of the tax breaks.
Depending on the type of imported goods, importers or manufacturers may need to obtain these regulatory clearances from the Food and Drug Administration, Department of Environment and Natural Resources, Department of Health, or other concerned agencies.
On the other hand, imported health products for donation, certified by a regulatory agency or its accredited third party in the originating countries with established regulation, “shall automatically be cleared.”
“The certification shall not be required for health products which are not subject to clearance from FDA,” the CAO states.
The CAO likewise provides for the retroactive effectivity of the grant of tax exemptions on eligible imports beginning June 25, 2020, or when RA 11469 or the Bayanihan to Heal as One Act (Bayanihan 1) expired.
For covered goods which arrived and were cleared by the BOC beginning June 25, the CAO allows for a refund of the taxes and duties paid, provided the importer secures a Tax Exemption Indorsement (TEI) from the DOF Revenue Office (RO). The amount of refund will be limited to the actual duties and taxes received by the BOC.
For speedy release of the medical supplies and equipment covered by the order, including foreign donations to a national government agency, the CAO states that the joint order on relief consignment and Customs Memorandum Order (CMO) No. 07-2020 on the Interim Procedure on the Provisional Goods Declaration (PGD) and its related issuances will apply.
A PGD is a form of declaration allowing the tentative release of shipments when the declarant does not have all the information or supporting documents to complete the goods declaration. But the requirements must be submitted within the period prescribed by law.
Shipments entitled to exemption may be released under PGD, as long as a TEI from the DOF-RO is submitted within the period prescribed.
A copy of the CAO has yet to be issued by BOC as of press time.