Preamble
WHEREAS, rural banks play a vital role in the agricultural development program of the Government, as they serve the vast majority of the population in the rural areas; WHEREAS, rural banks had earlier been granted tax privileges to strengthen and ensure their viability; WHEREAS, however, Presidential Decree No. 1955 withdrew the duty and tax privileges granted to private business, enterprises and or persons engaged in any economic activity, including rural banks; WHEREAS, the withdrawal of the tax exemption previously extended to rural banks, has adversely affected the profitability and viability of more than ninety percent (90%) of all rural banks operating throughout the country, especially in view of the prevailing economic conditions; WHEREAS, the restoration of the tax exemption of rural banks, will certainly help them weather the present economic crisis; WHEREAS, Parliamentary Bill No. 4531 introduced by MPs Emilio C. Macias II and Ricardo D. Abiera, was pending in the Batasang Pambansa, but was not passed before the Batasan's adjournment, for lack of material time; WHEREAS, considering the urgent representations of the rural bankers, and in order to ensure their survival in the face of the grave emergency caused by present economic difficulties, there is a need to act expeditiously to save the rural banking system from total collapse; NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by virtue of the powers vested upon me by the Constitution, do hereby decree: