Question & AnswerQ&A (PRESIDENTIAL DECREE NO. 1955)
The primary objective of Presidential Decree No. 1955 is to withdraw, subject to certain conditions, the duty and tax privileges previously granted to private business enterprises and/or persons engaged in any economic activity as part of a national economic recovery program in response to a grave economic crisis.
It was promulgated under the powers vested in the President by the Constitution of the Philippines and pursuant to Section 20 of Batas Pambansa Blg. 391, the Investment Incentives Policy Act of 1983.
The current economic crisis amounting to a grave emergency that affected the stability of the nation and required immediate action prompted the issuance of PD No. 1955.
No. PD No. 1955 withdraws all exemptions and preferential treatment in the payment of duties, taxes, fees, imposts, and other charges except those specifically exempted under certain conditions outlined in the decree.
Exemptions remain for: 1) Those registered by the Board of Investments under PD No. 1789, as amended; 2) Those registered by the Export Processing Zone Authority under PD No. 66, as amended; 3) The copper mining industry under LOI 1416; 4) Those covered by international agreements signed by the Philippines; 5) Those covered by the Constitution's non-impairment clause; and 6) Those approved by the President upon recommendation of the Minister of Finance.
The Ministry of Finance is tasked to promulgate the necessary rules and regulations to effectively implement the provisions of PD No. 1955.
All laws, decrees, executive orders, administrative orders, rules, regulations, or parts thereof inconsistent with PD No. 1955 are repealed, amended, or modified accordingly.
Presidential Decree No. 1955 took effect on October 15, 1984.
Section 20 authorizes the President to restructure or rationalize all existing incentives systems and legislations to align with overall economic development objectives and to make such incentives responsive and meaningful to changing circumstances.