The board of the Philippine Economic Zone Authority agreed to accept the proposed Corporate Income Tax and Incentive Rationalization Act in its current form, according to Trade Secretary Ramon Lopez.
Lopez said he persuaded the PEZA board, including director-general Charito Plaza, to accept the second tranche of the tax reform program.
“I called a special board meeting of PEZA to emphasize the importance of the tax and incentives reform that we are pushing for, which has the mandate from our President and approved by the Cabinet. We had to explain fully that there are ongoing refinements in certain provisions of the bill to address the serious concerns of the stakeholders, especially the existing PEZA locators, and some senators who are equally concerned on minimizing any possible repercussion on jobs if some firms leave the country,” he said.
The Trade Department is currently discussing the number of years in the sunset provision for existing locators and the extra years of income tax holiday and lower tax rates for new projects in strategic, high-technology industries with preference on locating in least developed areas.
Lopez said the concerns of the stakeholders were being addressed.
“With these adjustments, the PEZA board together with its management led by the director-general, has officially aligned its position to give strong support to the CITIRA and its parameters of having longer performance-based, time-bound, focused and transparent set of incentives. PEZA DG will no [longer] ask for status quo or exemption from the CITIRA,” he said.
Plaza said, “PEZA wants to end the agony of waiting and uncertainty caused by pending tax reform that has affected new investments and expansion projects of current PEZA-registered industries.”
“We want to ensure continuous investments for the Philippines and for the jobs of Filipino people. We intend to help craft a landmark legislation that will enhance and promote investments to the Philippines to achieve the overall welfare and good of the country and the people,” Plaza said.