The Department of Finance (DOF) has green-lighted the implementing rules and regulations (IRR) on the tax and duty-free importation of goods critical for the coronavirus response and blended hybrid learning.
Finance Secretary Carlos G. Dominguez III said that he signed Customs Administrative Order (CAO) No. 12-2020 to boost the country’s healthcare capacity against COVID-19 and facilitate the government's “blended” or online learning system amid the global health crisis.
CAO No. 12-2020 established the compliance system, or IRR, for importers and manufacturers entitled to 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 tax exemption under Bayanihan 2.
On top of medical supplies, the tax-exempt goods now include personal computers, laptops, tablets, or similar equipment appropriate for use in schools, donated for distribution to public schools, including state universities and colleges (SUCs) and vocational institutions under the Technical Education and Skills Development Authority (TESDA).
The tax exemptions will be effective until December 19, 2020.
The CAO further specified the operational procedures and regulatory clearances from various government agencies that importers or manufacturers need to comply with to avail of the tax breaks.
Depending on the type of imported goods, the regulatory clearances that need to be obtained to avail of the exemption may come from the Food and Drug Administration (FDA), Department of Environment and Natural Resources, Department of Health, and 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 stated.
The CAO likewise provided 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 Customs beginning June 25, the CAO allows for a refund of the taxes and duties paid, provided that the importer secures a Tax Exemption Indorsement (TEI) from the Revenue Office of the DOF.