Section 42. Tax Incentives

1. Any donation, bequest, subsidy or financial aid which may be made to government agencies engaged in the rehabilitation of disabled persons and organizations of disabled persons shall be exempt form the donor’s tax subject to the provisions of Section 94 of the National Internal Revenue Code (NIRC), as amended and shall be allowed as deduction from the donor’s gross income for purposes of computing the taxable income subject to the provisions of Section 29 (h) of the Code.

2. Donations from foreign countries shall be exempt from taxes and duties on importation subject to the provisions of Section 105 of the Tariff and Customs Code of the Philippines, as amended, Section 103 of the NIRC, as amended and other relevant laws and international agreements.

3. Local manufacturing of technical aids and appliances used by disabled persons shall be considered as a preferred area of investment subject to the provisions of Executive Order No. 226 otherwise known as the Omnibus Investments Code of 1987’ and, as such, shall enjoy the rights, privileges and incentives as provided in said Code such as, but not limited, to the following:

   1. repatriation of investments;

   2. remittance of earnings;

   3. remittance of payments on foreign contracts;

   4. freedom from expropriations;

   5. freedom from requisition of investment;

   6. income tax holiday;

   7. additional deduction for labor expense;

   8. tax and duty exemption on imported capital equipment;

   9. tax credit on domestic capital equipment;

   10. exemption from contractor’s tax;

   11. simplification of customs procedures;

   12. unrestricted use of consigned equipment;

   13. employment of foreign nationals;

   14. tax credits for taxes and duties on raw materials;

   15. access to bonded manufacturing/trading warehouse system;

   16. exemption from taxes and duties on imported spare parts; and

   17. Exemption from wharfage dues and any export tax, duty, impost and free.