The Philippine Department of Finance is reviewing a fiscal incentives bill passed by the House of Representatives before it is deliberated upon by the Senate.
The rationalization of fiscal incentives is among the top priorities of leading business groups including The Philippine Chamber of Commerce and Industry (PCCI), the country’s most influential and biggest business association of more than 35,000 enterprises. It is also supported by the Foreign Chambers of Commerce and other major industry and business associations.
The proposed Investment and Incentives Code of the Philippines grants most tax breaks to export-oriented enterprises, defined as enterprises that export at least 70% of their production. It also grants incentives to strategic domestic enterprises identified under the annual Investments Priorities Plan and those located in Mindanao and the 30 poorest provinces in the country.
The Department of Finance wants to assign all incentive-granting functions solely to the Board of Investments, which is under the Department of Trade and Industry. At present, incentives may be granted by a host of other bodies including the Philippine Economic Zone Authority, the Bases Conversion Development Authority, and other economic zones.
The Department of Finance wants a uniform policy on the issuance of fiscal incentives to businesses to avoid redundancies and lost revenues for the government.
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