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PRESIDENTIAL DECREE NO. 1393
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PRESIDENTIAL DECREE NO. 1393 -
AMENDING TITLE IV (SPECIFIC TAXES) OF THE NATIONAL INTERNAL REVENUE
CODE OF 1977, BY ADDING A NEW Section THERETO PROVIDING FOR A
FLEXIBILITY CLAUSE, AND FURTHER AMENDING Section 193 (c). TITLE V
(TAXES ON BUSINESS), BY PROVIDING FOR ADDITIONAL CONDITIONS AND
SPECIFIC LIMITATIONS ON THE EXERCISE OF THE POWER UNDER THE FLEXIBILITY
CLAUSE.
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chanroblesvirtualawlibrary
WHEREAS, it
is necessary to give flexibility to the tax system in order to improve
and optimize its sensitiveness and conformity to the rapidly changing
patterns of the economic, and political environment;chanroblesvirtualawlibrary
WHEREAS, the President is equipped with relevant data for the
formulation of immediate, timely and effective measures to make the tax
system more responsive to current conditions;chanroblesvirtualawlibrary
NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines,
by virtue of the powers vested in me by the Constitution, do hereby
order and decree the following:cralaw:red
Section 1. Title IV (Specific Taxes) of the National
Internal Revenue Code of 1977 is hereby amended by adding a new section
thereto, Section 158-A, to read as follows:cralaw:red
"Sec. 158-A. Flexibility Clause. (a) In general. — In
the interest of the national economy and general welfare, and subject
to the limitations herein prescribed, the President upon recommendation
of the Secretary of Finance and the National Economic and Development
Authority, is hereby empowered to revise the rates of specific taxes.
"The foregoing authority may be exercised by the President if any of
the following conditions exists; chanroblesvirtualawlibrary
"(1) Where, in the interest of economic development,
it is necessary to redirect expenditure or consumption patterns;chanroblesvirtualawlibrary
"(2) Whenever by reason of fluctuation of currency
values and/or inflation or deflation, the existing taxable base and
rates levels are no longer realistic or consistent with current price
levels;chanroblesvirtualawlibrary
"(3) When it is necessary to counter adverse action
on the part of another country.
"(b) Specific limitations on the exercise of
authority granted.
"1. The existing rates of specific taxes may be
increased by not more than 50%, or decreased by not more than 10%.
"2. Before any recommendation is submitted to the
President by the Secretary of Finance and the National Economic and
Development Authority pursuant to the provisions of this section, a
public hearing shall whenever practicable be held and interested
parties afforded a reasonable opportunity to be heard." chanroblesvirtualawlibrary
Section 2. Section 193(c). Title V (taxes on
Business) is hereby amended to read as follows:cralaw:red
"Sec. 193. Payment of percentage taxes. —chanroblesvirtualawlibrary
xxx
xxx
xxx
"(c) Flexibility Clause. — (1) In general. — In the
interest of the national economy and general welfare, and subject to
the limitations herein prescribed, the President upon recommendation of
the Secretary of Finance and the National Economic and Development
Authority, is hereby empowered to;chanroblesvirtualawlibrary
"a) Revise the rates of percentage taxes;chanroblesvirtualawlibrary
"b) Change the classification of articles enumerated
in Sections 194, 195, 196, 197, 198, 199 and 201; and
"c) Revise the taxable base levels in Sections 195
and 197.
"The above authority may be exercised by the President if any of the
following conditions exists;chanroblesvirtualawlibrary
"(1) Where, in the interest of economic development,
it is necessary to redirect expenditures or consumption patterns;chanroblesvirtualawlibrary
"(2) Where, in the light of technological and social
changes, it is necessary to change the classification of certain
articles on the basis of the changed concepts of essentiality or the
decree of manufacturing done;chanroblesvirtualawlibrary
"(3) Whenever by reason of fluctuation of currency
values and/or inflation or deflation, the existing taxable base and/or
price levels are no longer realistic or consistent with current price
levels;chanroblesvirtualawlibrary
"(4) When it is necessary to counter adverse action
on the part of another country.
"(2) Specific limitations on the exercise of
authority granted.
"a) the existing rates of percentage taxes may be
increased by not more than 50%, or decreased by not more than
10%. chanroblesvirtualawlibrary
"b) The existing price levels may be increased or
decreased by not more than 50%.
"c) Before any recommendation is submitted to the
President by the Secretary of Finance and the National Economic and
Development Authority pursuant to the provisions of this section, a
public hearing shall whenever practicable be held and interested
parties afforded a reasonable opportunity to be heard."
Section 3. Effectivity. — This Decree shall take
effect upon approval.
Done in the City of Manila,
this 31st day of May, in the year of Our Lord, nineteen hundred and
seventy-eight.
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