New IPP to include perks for drug rehab facilities

The draft new Investment Priorities Plan (IPP) has tightened rules on tourism accommodation and low-cost mass housing projects but added new areas, including drug rehabilitation facilities, that will be entitled to the government’s juicy tax incentive package.

Trade and Industry Secretary Ramon M. Lopez told reporters that the IPP, which is good for three years (2017-2019) is expected for submission to Malacañang next week. The IPP is a list of government priority projects that are entitled to a package of tax incentives, including maximum eight year income tax holiday.

“Hopefully we can have the new IPP signed by the President before the end of the year,” Lopez said. On tourist accommodation facilities, Lopez said the new IPP is going to remove incentives for tourist accommodation projects locating in Boracay.

The move is seen to encourage establishments of new hotels and tourist facilities in other islands in the country where they are most needed. Boracay has seen phenomenal construction of five-star hotels recently. There is also a good number of medium and low-cost accommodation facilities in the island that there is now enough room to accommodate tourists in the country's premier tourist destination.

On low cost mass housing projects, the IPP is expected to retain incentives only to housing units but a lower price of below R2 million. Also, projects in Metro Manila may no longer be entitled to incentives. Low cost mass housing developers have been opposed to downgrading the incentives granted to their sector and restricting developments in Metro Manila.

“Several projects are in the pipeline for Metro Manila considering that there is still backlog in low cost, economic and socialized housing and no efficient mass transport system,” an industry official said. Last year alone, the official said, almost R10 billion worth of investments for mass housing projects had been poured in Metro Manila from members of one housing organization alone. The same organization also invested R1 billion worth of projects outside of the metropolis in the same year.

“We hope to convince BOI to keep it (incentives) in the 2017-2019 IPP and come up with programs that will ensure growth of input sectors like cement, rebars, paint, roofing materials, doors, electricals etc. while housing continue to address the new housing needs and backlog,” the official said.