PEZA defends incentives

MANILA, Philippines - The Philippine Economic and Zone Authority (PEZA), an investment promotion agency of the government, defended the fiscal incentives it provides to PEZA locators, saying that the incentives to do not intend to hurt local industries.

PEZA Director General Lilia de Lima said PEZA only provides incentives to export-oriented companies.

“We always respect a level playing field,” De Lima said yesterday during a joint fiscal incentives workshop of the International Monetary Fund (IMF) and the Department of Finance (DOF).

In defending the fiscal incentives granted to investors, De Lima said PEZA locators contribute significantly to the economy.

She said that in 2010 alone, PEZA locators paid a net amount of P14 billion in taxes. She said their actual contribution to economic growth would go higher when taken into account the salaries and contracts with suppliers.

PEZA is an agency attached to the Department of Trade and Industry (DTI). It is tasked to promote investments, extend assistance, register, grant incentives to and facilitate the business operations of investors in export-oriented facilities inside selected areas throughout the country.

The DTI and DOF are pushing for a measure that would rationalize fiscal incentives given to investors. A bill has been filed in Congress but lawmakers have yet to approve the measure.

The position of the Finance department is that there should be a limit in the grant of incentives to investors, only with the possibility for renewing these incentives if deemed necessary.

During yesterday’s workshop, Finance Undersecretary Jeremias Paul said the Finance department is not against incentives.