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THE JEWELRY INDUSTRY DEVELOPMENT ACT OF 1998
1. What is the
Jewelry Industry Development Act of 1998?
Republic Act No.
8502, otherwise known as the Jewelry Industry Development Act of
1998, is an act to promote the development of the jewelry
manufacturing industry, providing incentives therefor and for
other purposes.
2.
When was it
signed into law?
Republic Act 8502
was signed into law by then President Fidel V. Ramos on February
13, 1998 and took effect on July 9, 1998. However, the
implementing rules and regulations as promulgated by the
Department of Finance and the Bureau of Customs took effect only
on January 25, 1999.
3.
How does the
state intend to encourage the development of the jewelry industry?
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By promoting and
encouraging local jewelers to join the formal sector by making the
industry sector a partner in the establishment of an adequate
support structure, and by creating a business environment
conducive to the viability, legalization and development of the
jewelry sector;
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By adopting
appropriate tax incentives and programs necessary for the
acceleration and growth of the industry; and
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By promoting and
institutionalizing the effective promotion and participation of
associations of the jewelry industry and cooperatives particularly
in the advancement of the skills and craftsmanship of Filipino
workers therein.
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4.
What are the
incentives granted under this Act?
Pursuant to Section 3 of Republic
Act 8502, the following incentives shall be available to a
qualified jewelry industry:
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Entitlement to
zero (0) duty on imported raw materials which include precious
metals, loose gems, precious stones, jewelry parts, accessories
and supplies for use by a jewelry enterprise, as specifically
mentioned in Chapter 5 of Section 1, Chapter 12 of Section II,
Chapters 25, 26 and 27 of Section V, Chapters 28, 34 and 38 of
Section VI, Chapter 70 of Section XIII, Chapter 71 of Section XIV,
Chapter 83 of Section XV, and Chapter 96 of Section XX, all of the
Tariff and Customs Code, as amended;
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Exemption from
the imposition of excise tax on all goods commonly or commercially
known as jewelry, whether real or imitations thereof; all goods
made of, or ornamented, mounted or fitted with precious metals or
imitations thereof, as specifically mentioned in Section 150(a) of
the National Internal Revenue Code of the Philippines, as amended;
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Entitlement to
zero duty on imported capital equipment, including spare parts and
toolings thereof falling within Chapter 69 of Section XIII, and
Chapter 90 of Section XVIII of the Tariff and Customs Code, as
amended;
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Additional
deduction from taxable income of fifty percent (50%) of expenses
incurred in training schemes approved by the appropriate agency
which shall be deductible during the financial year the expenses
were incurred;
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Gold and silver
sales by the Bangko Sentral ng Pilipinas to jewelry enterprises
under minimal margins;
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Authority for
jewelry enterprises to buy gold and silver directly from other
sources;
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Inclusion of
locally-manufactured jewelry in the government's tourist duty free
shops including the promotion, advertisement and sale thereof; and
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Jewelry
enterprises availing of incentives provided under the Act shall
still be eligible to incentives provided by other special laws
such as Republic Act No. 7844 (Export Development Act of 1994),
Republic Act No. 7916 (Special Economic Zone Act of 1995),
Executive Order 226 (BOI Omnibus Investment Code), among others: Provided,
That the activity is export-oriented and that there is no double
availment of the same incentives. |
5.
How can a
qualified jewelry enterprise avail itself of the said incentives?
Section 4 of the
Act expressly provides that to qualify for the assistance,
counseling and other incentives envisioned in the Act, jewelry
enterprises availing of the same must be duly registered with the
appropriate government agency which is the Board of Investments (BOI)
as provided by law.
6.
What is a jewelry
enterprise?
A "jewelry enterprise," as used in the Act, shall refer
to
any enterprise engaged in any aspect in the manufacture of goods
commonly or commercially known as fine and imitation jewelry
including those producing, cutting and polishing, shaping,
refining, forming or fabricating real or imitation pearls,
precious and semi-precious stones and imitations thereof, goods
made of precious metal and imitations thereof, and other raw
materials and parts used in the manufacture of jewelry.
7.
What was the role
of the Tariff Commission in the promulgation of this Act?
The Tariff
Commission, in coordination with the representatives of the
jewelry industry and the BOI, provided the technical expertise in
the tariff classification and preparation of the list of products
and equipment entitled to zero duty under the Act. It continues to
assist in the tariff classification of products and equipment
eligible for duty-free treatment.
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