Economic agencies are granting incentives to manufacturers of equipment critical to combat the coronavirus disease 2019 (COVID-19) such as personal protective equipment (PPE).
The Department of Trade and Industry (DTI) said under Joint Memorandum Circular (JMC) 20-02 it signed with the Department of Finance on 1 April following Republic Act 11469 or the Bayanihan to Heal as One Act, both agencies were granted authority to liberalize the grant of incentives for the manufacture and importation of key equipment or supplies.
Under the JMC, the agencies will ensure the availability of essential goods and require businesses to prioritize contracts, subject to fair and reasonable terms, for the materials and services needed by the government to prevent the spread of COVID-19.
The JMC covers the production products identified as critical by the Department of Health such as medicines, medical equipment and devices, PPE, surgical equipment and supplies and laboratory equipment and its reagents.
Goods to be imported under the agreement shall be exempt from import duties, taxes and other fees such as import processing fees and other fees imposed by the Bureau of Customs (BoC), Food and Drug Administration and other relevant agencies.
“We need to ensure that the disruptions in the supply chain are minimized, as well as give enterprises a reprieve from commonly imposed taxes,” DTI Secretary Ramon Lopez said.
Health safety goods
DoF Secretary Carlos Dominguez III said the government will provide aid to manufacturers, particularly those partnering with medical institutions and hospitals, to procure or produce the essential goods qualified for tax breaks.
The JMC covers enterprises namely manufacturers or producers, suppliers of raw materials, manufacturers of packaging materials and suppliers of raw materials for the packaging.
Meanwhile, the BoC is also required to provide a green lane to the preferred enterprises and render a final assessment of the goods within 24 hours from the online filing of declarations to facilitate the movement of the items.
The JMC also suspended a requirement on these ventures to export a portion of their output.
“The export enterprises that manufacture the covered products shall supply at least 80 percent of their daily production to the procuring entity determined under RA 11469,” the JMC stated.