PEZA defends ‘competitive’ incentives anew

The Philippine Economic Zone Authority (PEZA) stood by the incentives package it extends to registered companies, saying the tax perks are competitive and performance-based.

The government is looking to rationalize the incentives granted to PEZA-registered firms under the proposed second package of the Comprehensive Tax Reform Program. PEZA has been lobbying to exclude its locators from the scheme, reasoning out that the country is otherwise slated to lose investors’ confidence.

PEZa’s rebut is in reply to the Department of Finance’s earlier statement saying the current system of granting incentives “has been tilted in favor of few companies for so long.” The DoF said the proposed rationalization is geared towards instituting performance-based, time-bound, targeted and transparent set of incentives.

But PEZA said that the registered companies have to adhere to several requirements such as the guidelines on fiscal and performance reports in order to avail of the incentives.

“PEZA incentives are not given to companies, enterprises, locators, or ecozone developers per se, but incentives for export-based industries are for those who are able to upgrade their products, activities, expand their projects and markets, and those who can bring technology-transfer in the Philippines,” PEZA director general Charito B. Plaza said in a statement on Tuesday.

Moreover, PEZA also said that the removal of the five percent tax on gross income earned paid by ecozone developers, operators and enterprises instead of local and national taxes under the Citira bill can lead to corruption.