Business World

Tourism body gets 10 more years to of­fer perks

- A. Aguinaldo Camille

CONGRESS has rat­i­fied a mea­sure ex­tend­ing the power of the Tourism In­fras­truc­ture and En­ter­prise Zone Au­thor­ity (TIEZA) to grant in­cen­tives to tourism en­ter­prises for an­other 10 years.

The House of Rep­re­sen­ta­tives and the Se­nate have agreed to ex­tend the body’s au­thor­ity to Dec. 31, 2029. The House ver­sion of the bill had pro­posed an ex­ten­sion to just Dec. 31, 2026. The bill amends Repub­lic Act No. 9593 or the Tourism Act of 2009.

The orig­i­nal law and suc­ceed­ing reg­u­la­tions gave TIEZA only un­til Au­gust 2019 to grant in­cen­tives. The in­cen­tives TIEZA grants tourism en­ter­prises in­clude a six-year in­come tax hol­i­day, a five per­cent pref­er­en­tial tax on gross in­come, ex­emp­tion from all taxes and cus­toms du­ties of im­por­ta­tion of cap­i­tal equip­ment as well as of spare parts.

“Rat­i­fy­ing this bi­cam­eral con­fer­ence com­mit­tee re­port is an­other mile­stone in the tourism in­dus­try, al­beit de­layed. The pri­mary pur­pose of the orig­i­nal law which we au­thored was to make sure that tourism be­comes a pri­mary en­gine of growth for our coun­try be­cause tourism means jobs,” Se­na­tor Richard J. Gor­don said in his Feb. 6 speech as he pre­sented the bi­cam­eral con­fer­ence com­mit­tee re­port for rat­i­fi­ca­tion.

It was re­vealed in Se­nate pub­lic hear­ings back in 2016 that TIEZA failed to grant in­cen­tives since the en­act­ment of the Tourism Act due to the lack of a rev­enue reg­u­la­tion. The Bureau of In­ter­nal Rev­enue then is­sued a rev­enue reg­u­la­tion in 2016 but lim­ited the pe­riod un­til 2019 due to the 10-year pe­riod pre­scribed in the orig­i­nal law. An ex­ten­sion pe­riod for the grant of in­cen­tives to tourism en­ter­prises was then sought in Congress.

The new law also al­lows the Joint Con­gres­sional Over­sight Com­mit­tee on Tourism to op­er­ate in­def­i­nitely from 10 years pre­vi­ously. The com­mit­tee con­sists of the chair­men of both cham­bers’ com­mit­tees of tourism, ways and means, ap­pro­pri­a­tions and of fi­nance, among oth­ers. —

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