After reading, Incentive Scheme Under Republic Act No. 9367 or The Biofuels Act of 2006, read also Mandatory Use of Biofuels Under Republic Act No. 9367 or The Biofuels Act of 2006
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Investments in the production, distribution of locally produced biofuels have incentives
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Specific tax on local or imported biofuels component, per liter of volume shall be zero (0)
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The sale of raw material used in the production of biofuels shall be exempt from the value added tax
In our previous article, it was mentioned that Republic Act No. 9367 of the Biofuels Act of 2006 mandates that all liquid fuels for motors and engines sold in the Philippines shall contain locally-sourced biofuels.
To encourage investments in the production, distribution and locally produced biofuels, and without prejudice to enjoying applicable incentives and benefits under existing laws, rules and regulations, the following additional incentives are provided under the law:
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Specific tax
The specific tax on local or imported biofuels component, per liter of volume shall be zero (0). The gasoline and diesel fuel component shall remain subject to the prevailing specific tax rates.
b. Value Added Tax
The sale of raw material used in the production of biofuels such as, but not limited to, coconut, jatropha, sugarcane, cassava, corn, and sweet sorghum shall be exempt from the value added tax.
c. Water Effluents
All water effluents, such as but not limited to distillery slops from the production of biofuels used as liquid fertilizer and for other agricultural purposes are considered “reuse”, are exempt from wastewater charges under the system provided under the Philippine Clean Water Act.
d. Financial Assistance
Government financial institutions, such as the Development Bank of the Philippines, Land Bank of the Philippines, and other government institutions providing financial services shall, in accordance with and to the extent allowed by the enabling provisions of their respective charters or applicable laws, accord high priority to extend financing to Filipino citizens or entities, at least sixty percent (60%) of the capital stock of which belongs to citizens of the Philippines that shall engage in activities involving production, storage, handling and transport of biofuel and biofuel feedstock, including the blending of biofuels with petroleum, as certified by the Department of Energy.
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