Draft strategic investment plan completed
THE Ministry of Trade and Industry has completed its final draft Strategic Investment Priorities Plan (SIPP) of the Business Recovery and Business Tax Incentives (Create) Act and submitted it to the President of the House Ways and Means Committee.
Albay Representative Jose Maria Clemente “Joey” Salceda, chairman of the committee, told reporters on Tuesday because the SIPP would allow foreign and domestic investors to apply for tax incentives for their respective sectors.
Salceda said he expects a strong foreign direct investment (FDI) performance for the Philippines in 2022, after 2021 was the country’s best ever FDI performance.
“2021 has been a solid year for FDI, thanks to the prospect of finalizing our reforms. 2022 is when these reforms will actually be fully implemented. I expect even better IDE performance this year,” Salceda said.
In his letter to Salceda, Secretary of Commerce Ramon Lopez credited Salceda’s contributions and support for finalizing the SIPP project.
“Following the constructive meeting with you of Undersecretaries Rafaelita Aldaba and Ceferino Rodolfo, we have adopted the approach of the interim-transitional-full framework for the SIPP,” Lopez wrote to Salceda.
Lopez also cited the House committee resolution supporting the framework, which helped get the list approved by the Tax Incentives Review Board (FIRB).
“The current project was presented to the technical committee of the FIRB on March 31, 2022 as well as to the investment promotion agencies on the same day,” Lopez added.
Salceda said the issuance of the SIPP will allow sectors not listed in the 2020 Investment Priorities Plan to apply for tax incentives and invest in the Philippines.
This, he said, will create new jobs and business opportunities for the Philippine economy.
“I thank the secretaries Lopez and [Finance Secretary Carlos] Dominguez [3rd] for the work they have done on the SIPP. This will undoubtedly encourage more investors, especially in high value-added sectors, to locate in the Philippines and take advantage of some of the best incentives from ASEAN (Association of Southeast Asian Nations ),” Salceda said.
The Create law, which came into force on April 11, 2021, reduced corporation tax from 30% to 25% for large companies and to 20% for small and medium-sized companies whose net taxable income does not exceed 5 million pula.
It offers tax relief to domestic and foreign investors doing business in the country, a measure intended to encourage businessmen to set up domestic operations with the aim of stimulating economic activities and contributing to the pursuit of the recovery of the economy.