Amendments to Omnibus Investments Code

Pioneer firms receive a six-year ITH from the start of commercial operation.
Non-pioneer firms receive a four-year ITH.
Extension of ITH for one year may be granted if:
- The project meets the capital equipment to worker ratio prescribed by the Board.
- Utilizes indigenous raw materials at approved rates.
- Achieves net foreign exchange savings or earnings of at least US$500,000 annually during the first three years.
Maximum ITH for pioneer firms is eight years.
Expanding firms get proportional ITH for three years based on expansion.
No additional extension of ITH is allowed.

Registered enterprises get 50% additional deduction on wages for incremental direct labor (skilled and unskilled) for the first five years from registration.
This deduction doubles if the enterprise is in less developed areas.

Applies to new, expanding, or modernizing registered enterprises registered by December 31, 1994.
Exemption covers 100% taxes and customs duties on importations until December 31, 1997 or up to 1999 if outside NCR.
Conditions for importation exemption:
1. Equipment not available domestically in sufficient quantity or comparable quality at reasonable prices.
2. Equipment must be exclusively used for registered activity unless approval for partial use.
3. Board approval required.
International canvassing or competitive bidding may be required for capital equipment costs exceeding US$5,000,000.
Sale, transfer or disposal of exempted equipment within five years requires Board approval and may incur penalties.

Registered enterprises can claim a tax credit equivalent to taxes and duties that would have been waived if the machinery/spare parts were imported.
Conditions include usage exclusivity, Board approval, and purchase deadlines.

Customs procedures related to importation and export by registered enterprises are simplified.

No restriction on usage period for consigned machinery/equipment if re-export bonds are posted.
Sale or transfer of such equipment follows the same rules as imported capital equipment.
Outward remittance from sales requires BSP approval.

Registered enterprises may employ foreign nationals in supervisory, technical, or advisory roles for up to five years, extendible at the Board's discretion.
Foreign nationals may retain key executive positions beyond five years if majority foreign-owned.
Spouses and unmarried children of foreign employees not excluded by law may reside in the Philippines.
Registered enterprises must train Filipinos as understudies and report annually.

Tax and duty exemption applies for ten years from registration for importation of breeding stocks/genetic materials.
Conditions include non-availability locally, necessity for registered activity, and Board approval.

Tax credit equivalent to taxes and duties waived on importation is granted for domestic purchases under specified conditions and approval.

Registered enterprises receive tax credit for internal revenue taxes and customs duties paid on supplies, raw materials, and semi-manufactured products used in exports.
Taxes must be listed separately on sales invoices.
Board may set fixed percentage approximations based on industry standards.

Registered export-oriented enterprises may use bonded warehousing system subject to Board and Customs guidelines.

Registered enterprises importing spare parts for consigned equipment or imported tax/duty-free equipment are exempt from related taxes and customs duties.
Conditions include at least 70% production exported and local unavailability.
Usage restricted to bonded manufacturing warehouse.

Exports of non-traditional products by registered enterprises are exempt from wharfage dues, export taxes, duties, imposts, and fees.

Existing provisions of EO No. 226 and Republic Act No. 7369 not affected remain valid.
Inconsistent laws, decrees, orders, regulations are repealed or modified.

The Act is retroactive to May 5, 1994.
It takes effect fifteen days after publication in newspapers of general circulation.