Law Summary
Gradual Period of Duties and Taxes Exemption
- Full exemption from approval date until December 31, 1966.
- 75% exemption from January 1, 1967 to December 31, 1968.
- 50% exemption from January 1 to December 31, 1969.
- 25% exemption from January 1 to December 31, 1970.
- Full payment of taxes and duties effective January 1, 1971.
Prohibition on Sale or Transfer of Imported Materials in Raw Form
- Imported raw materials, chemicals, dyestuffs or spare parts under this Act cannot be sold, transferred, or conveyed in their raw form or as spare parts.
Special Tax and Textile Research Fund
- Registered textile manufacturers pay a special tax of 1% of gross sales in lieu of the exempted taxes.
- The special tax is collected similarly to the sales tax, subject to similar penalties.
- Funds are allocated to the National Science Development Board for research projects aimed at:
- Local growth and production of raw materials.
- Improvement or invention of machinery, equipment, and production methods for the industry.
Exclusive Tax Exemption Privileges
- Entities enjoying tax exemptions under this Act cannot avail tax exemption benefits under other laws simultaneously.
Penalties for Violations and Misrepresentations
- Violations lead to:
- Cancellation of registration by the Board of Industries.
- Payment of twice the amount of duties and taxes evaded plus penalties and surcharges.
- Imprisonment from 2 to 5 years.
- Fine ranging from ₱10,000 to ₱20,000.
- In cases involving corporations or entities, responsible officers like President or Manager are held criminally liable.
Repealing Clause
- All inconsistent laws, orders, rules, and regulations are repealed or modified to conform with this Act.
Effectivity
- The Act takes effect immediately upon approval on June 18, 1964.