Bilyonaryo - Business

You’re not doing your job, DOF tells PEZA

By Eileen Mencias
The Department of Finance has chided the Philippine Economic Zone Authority for its failure to track the inflow of actual investments made by its registered business enterprises since the implementation of the Corporate Recovery and Tax Incentives for Enterprises Act (CREATE).
Assistant Finance Secretary Juvy Danofrata said the investments of PEZA locators would help “determine if these are commensurate to the value of fiscal incentives that such ecozone locators enjoy each year.”
“Peza submitted incomplete information about the investment capital and market orientation of its locators when it was asked to send data to the FIRB (Fiscal Incentives Review Board) as part of the compliance of IPAs (investment promotion agencies) with the provisions of the CREATE law,” Danofrata said.
“Peza did not give us data on the actual investment. They said they are not monitoring that,” Danofrata said.
Danofrata said these reports are important to enable the FIRB to fulfill its monitoring and oversight function over the IPAs and the overall administration and grant of tax incentives.
The PEZA and the FIRB/DOF are at loggerheads over the grant of incentives to business process outsourcing companies on a hybrid working arrangement.
The DOF insisted that 100 percent of the BPO employees should already be working onsite in April while PEZA pushed for the adoption of a hybrid work-from-home set up for the IT and business process outsourcing industries .
Danofrata said only four of the 14 IPAs complied with the reportorial requirement and that 12 out of the 196 businesses registered with the PEZA did not submit information on their investment capital and 11 did not identify the markets they were exporting to.
Danofrata said these reports from IPAs are also shared with other government agencies such as the Bureau of Internal Revenue (BIR), for monitoring, audit, and other purposes consistent with the target outcomes of CREATE.
Aside from PEZA, other investment promotion agencies are the Board of Investments, the Bases Conversion and Development Authority, the Aurora Economic Zone and Freeport Authority, the Subic Bay Metropolitan Authority and the Tourism Infrastructure and Enterprise Zone Authority, among others.