CEBU, Philippines - After over two years, the Cebu City Council has finally approved the ordinance that enacts the investment code of the city.
City Councilor Alvin Arcilla was in high spirits last August 20 after the Council passed the “Ordinance enacting the Cebu City investment incentive code, and appropriation of funds thereof” that he authored.
Arcilla said the ordinance aims to “create investor confidence and institutionalize the city government’s willingness to embrace the idea of helping businesses flourish in the city, not only for the taxes they pay but for the overall economic growth of the city.”
He said it is imperative to promote the city as an “attractive, competitive, and sustainable investment destination” and maintain it at the domestic and global economic stage.
The ordinance applies to all direct investments in the city, “including domestic and foreign, resident and non-resident, but shall exclude portfolio investments and short-term monetary operations.”
Section 5 of the ordinance takes up the creation of a Cebu City Investment Incentive Board, whose members shall formulate and define strategies and plans to pursue the policies stipulated in the measure.
The board would be composed of the mayor chairperson and the head of the City Council committee on trade, commerce and entrepreneurship as vice chairperson.
Other members would be the council committee on budget and finance head, city planning and development officer, city treasurer, the Department of Trade and Industry provincial director, DTI-Cebu, Cebu Chamber of Commerce and Industry president, and two private sector representatives to be appointed by the city mayor.
“The primary function of the board shall be to establish a favorable and stable policy on Cebu City’s business climate, which will encourage and support private sector investment and in the operation of business activities consistent with the economic development needs of the City,” read the ordinance.
Section 13 sets that each of the city’s 80 barangays appoints a barangay economic and investment officer who shall “gather, collate, analyze, and compile pertinent data and information and conduct studies in their barangay for a business suitability profile.”
The ordinance guarantees that registered enterprises are entitled to the rights and guarantees provided for by law and the Constitution.
One of the incentives for registered enterprises that has a capital investment in aggregate amount of not less than P5 million is that it is exempted from paying business tax, except garbage fees and other regulatory fees such as but not limited to Office of the Building Official fees, City Health inspection fees, zoning fees and fire and safety inspection fees.
At present, a business tax equivalent to one-twentieth of one percent of the capital investment, as set under Section 61 of City Tax ordinance LXIX, is imposed upon registration by a business establishment.
Another incentive is an additional 10 percent discount in the basic real property tax of the annual tax due for prompt payments made for all real properties consisting of land, buildings and machineries acquired by the business establishment during a period of three years from the date of registration.
According to the ordinance, the city shall allocate an initial amount of P2 million for the holding of an exposition to be called “Atong Produkto, Atong Garbo,” which would showcase the products and/or services produced or offered by registered enterprises. (FREEMAN)