LGUs urged to give incentives to startups

Local government units (LGUs) were urged yesterday to provide incentives to startup businesses, especially those opened by overseas Filipino workers (OFWs).

At the same time, Camarines Sur Rep. Luis Raymund Villafuerte asked the Department of Trade and Industry (DTI) to create a special office that would cater to startup entrepreneurs.

“My proposals will not only benefit our returning OFWs but also other budding entrepreneurs who have come up with innovative products, ideas or business models that need adequate funding to take off,” he said in a statement.

He said his suggestions could kick- start the stalled Philippine Roadmap for Digital Startups, which is supposed to come up with at least 500 new businesses in the country with total funding of $ 200 million and a valuation of $2 billion by 2020.

“Many of our OFWs, who have accumulated a vast amount of experience and knowledge from working overseas, have a lot of potential to become successful entrepreneurs,” Villafuerte, who is vice chairperson of the House committee on local government, said.

He cited the case of Myrna Padilla, a former housekeeper in Hong Kong who now heads Mynd Consulting and Outsourcing Phils., one of the biggest business process outsourcing firms in Davao City.

He said another former OFW, Bong Clavel, who used to be a boiler operator in the Marshall Islands, now owns Z-Jay Marketing, the biggest agriculture- veterinary supplies store in Alabel, Sarangani.

After struggling with startup problems, Clavel was able to expand his business, which now includes a fleet of minicabs and fishing boats, he said.

Villafuerte said OFWs like Clavel and Padilla would find it easier to hurdle challenges to their startups if a bill he had filed in Congress were to become a law.

Under House Bill 2882, the DTI is mandated to create a special office for startup entrepreneurs with an initial funding of P100 million.

A startup website would also be developed and maintained by the DTI to serve as the primary source of information on the implementation of the proposed law.

New businesses would be given tax incentives, including income tax and value added tax exemption.

Villafuerte said his bill “adopts the best practices in startup communities and tailors them to fit the Philippine startup ecosystem.”

“The continued growth of startups in the country benefits Filipinos who have innate talent for shaping contemporary ideas,” he said.

Sen. Paolo Benigno Aquino IV has filed a counterpart measure in the Senate.