Question & AnswerQ&A (PEZA MEMORANDUM CIRCULAR NO. 2000-003, NOVEMBER 13, 2000)
It concerns the inclusion of sub-contracting job revenues performed by economic zone export-producer enterprises for domestic market-oriented enterprises under local sales allowance and the imposition of local sales processing fees.
Such revenues should be counted as part of local sales to prevent abuse of machinery and equipment imported tax and duty-free by economic zone export-producer enterprises.
It should include the actual amounts received for the subcontracting job or activity, including cost of labor, value of other production inputs owned and supplied by the enterprise, overhead, and other costs.
No, the cost of raw materials, semi-finished products, and other materials supplied by domestic market-oriented enterprises should not be included in the subcontracting fee or revenue.
A 2% Local Sales Processing Fee is imposed on the subcontracting fee for every sub-contracting job performed for domestic market-oriented enterprises.
Yes, the LSPF per transaction shall not be less than ₱1,000.00 and not more than ₱10,000.00 per transaction.
PEZA Memorandum Circular No. 99-0009 dated November 9, 1999, implementing PEZA Board Resolution No. 99-263 dated October 6, 1999.
Yes, the 2% Local Sales Processing Fee already covers the application fee previously set at ₱1,000.00.
To prevent abuse in the use of machinery and equipment that economic zone export-producer enterprises are allowed to import tax and duty-free.
Lilia B. De Lima, Director General of PEZA, signed and adopted the memorandum on November 13, 2000.