The Fiscal Incentives Review Board denied the petition of the Philippine Economic Zone Authority to extend the work-from-home arrangement for the information technology and business process management sector.
“Considering all surrounding circumstances as well as relevant issues and points raised during the recently concluded FIRB meeting held on Feb. 21, 2022, the FIRB members were unanimous that the approval of PEZA’s request with great regard to WFH arrangement is not considered consistent with the economic strategy of the government of reopening the economy gradually and safely,” Finance Secretary and FIRB chairperson Carlos Dominguez said in a letter dated March 7 to PEZA director-general Charito Plaza.
PEZA was told to advise and remind all ITBPM enterprises to comply with the provisions of FIRB Resolution No. 19-21, which effectively extended WFH from Sept. 2021 to March 31, 2022. Non-compliance to the resolution would subject violators to penalties.
PEZA earlier proposed a policy that would allow registered ITBPM enterprises to operate on WFH arrangement until Sept. 12, 2022 without the diminution of fiscal incentives they enjoy as economic zone locators.
The FIRB said even government agencies were required to have most of their employees to physically report for work to their respective offices under the President’s Memorandum Circular No. 93, by 40 percent, 60 percent and 80 percent, under Alert Level 4, 3 and 2, respectively.
The board said all policies and programs such as allowing the pilot opening of face-to-face classes, adopting granular lockdown measures and expanding vaccination to include 5 to 17 years old were geared towards improving mobility and enhancing greater economic activity.
“Moreover, the FIRB’s thrust towards reopening the economy promoted higher utilization rates in infrastructure, specifically in office spaces, among concerned registered business enterprises. An increase in infrastructure utilization within ecozones or Freeports will encourage further expansion and diversification in the area and support the government’s initiative of making the country a safe investment and work destination,” Dominguez said.
The FIRB also denied PEZA’s request to lift the moratorium on ecozone expansion within Metro Manila, as agreed by board members in a meeting in February 2022.
“The members of the FIRB were all in unison for the continuation of the moratorium hence, (your) request is hereby denied,” the letter said.
The FIRB said locator companies in economic zones may still register and operate in existing ecozones in Metro Manila. New ecozones may still be established outside Metro Manila.
Plaza said the work-from-home setup is consistent with the implementing rules and regulations of Republic Act 11534 or the Corporate Recovery and Tax Incentives for Enterprises Act.
PEZA also appealed for the non-imposition of the penalties under FIRB Resolution No. 19-21 given its possible implications.
“PEZA-registered companies are coping with or recovering from the impacts of the pandemic. If it’s supposed to be a relief measure, we should not penalize the companies; rather, we must continue to assist our registered companies as much as possible given that protecting livelihoods of millions of Filipinos is an important national interest,” Plaza said.