In all cases where any city of the first class has by virtue of any general or special act of Assembly issued, or may hereafter issue, bonds, with or without interest coupons attached, to secure any indebtedness of any such city, which bonds may have matured but remain unpaid and uncancelled, or are about to mature and become payable, or whenever any such city shall have determined to redeem or pay any or all of such bonds upon or prior to maturity, or whenever holders of any such bonds of any such city which may not have matured or become redeemable are willing to surrender the whole or any part of any issue thereof, it shall be lawful for any such city for the purpose of redeeming or paying off upon, prior to, or after maturity any or all such bonds payable, redeemable or offered for redemption as aforesaid, including interest, premium and costs of issuance, redemption or payment, to issue and sell either registered or coupon bonds payable at any time not exceeding forty (40) years after the date of issuance thereof, and not exceeding in the aggregate the amount of the bonds necessary to accomplish the refunding, and the said bonds so issued and sold in accordance with the provisions of this act shall be exempt from taxation to the same extent as provided in section 1303 of the act of July 12, 1972 (P.L. 781, No. 185), known as the “Local Government Unit Debt Act”:¹ Provided, however, That such new bonds shall not mature later than fifty (50) years from the date of issuance of the original bonds: And provided further, That all assets in the sinking fund, if any, for the redemption of the issue of bonds proposed to be refunded shall first be applied to the payment, as far as applicable, of the principal of such bonds, and the balance of such issue only shall be paid or redeemed by the issue of new bonds.