By Arygll Geducos
Companies registered with the Board of Investments (BOI) can still enjoy duty-free importation of capital equipment, spare parts, and accessories.
Based on Executive Order (EO) No. 85 signed by President Duterte on July 19, the one-year extension will increase competitiveness of industries in line with the Philippine Development Plan 2017-2022.
“Considering that importation of capital equipment remains as one of the major cost burdens of business enterprises in their start-up and expansion, there is a need to again extend the zero percent duty on capital equipment, spare parts, and accessories currently being enjoyed by BOI-registered enterprises,” the EO read.
“The grant of duty-free importation of capital equipment remains to be an important fiscal incentive in promoting investments in the Philippines considering the global competition for foreign direct investments,” it added.
Based on the presidential order, the grant of duty-free importation of capital equipment is an important fiscal incentive in promoting investments into the Philippines considering the global competition for foreign direct investments.
However, it prohibits the selling, transferring or disposing of capital equipment, machinery, spare parts and accessories without prior BOI approval within five years from the date of importation.
Otherwise, the companies will be made to pay twice the amount of the foregone duty or P500,000 whichever is higher without prejudice to other applicable penalties.