For the first time, the government is going to open broadly the Investment Priorities Plan (IPP) to include the grant of generous tax incentive packages to the establishment of “micro-enterprises” that would engage in providing services and activities that would help save and preserve jobs.
Micro, small and medium enterprises will continue to get government support in the form of tax incentives and easy processing of application for registration with the Board of Investments (BOI) under the 2009 Investment Priorities Plan (IPP).
As stressed in the 2009 IPP specific guidelines, the BOI, the government’s incentives giving body, is promoting the development of MSMEs due to the sector’s contribution to employment generation, countryside development, and in the cultivation of the Filipino entrepreneurial spirit.
“MSMEs are the backbone of economic activity in the Philippines as they constitute more than 98 percent of total enterprises, and also because they are huge employment generator. So it is incumbent upon the government to provide full support to MSME development. In case of the BOI, this is not just a lip service as our full support is reflected in the IPP,” Trade Undersecretary and BOI managing head Elmer C. Hernandez told Entrepreneur.
The Omnibus Investment Code (Executive Order 222) outlines the kinds of fiscal and non-fiscal incentives that registered firms may secure from the IPP. Hernandez added that MSME’s are entitled to full incentives under the law.
Income tax holiday (ITH) for up to eight years, additional deduction for labor expense, tax and duty exemption on imported capital equipment, tax credit on domestic capital equipment, exemption from contractor’s tax, simplification of customs procedures, unrestricted use of consigned equipment, employment of foreign nationals, among others.
For more information, contact:
Philippine Board of Investments
Industry and Investments Building
385 Sen. J. Puyat Avenue, Makati City
Phones: (02) 890-9308/1332, 895-3640/3656/3641/3657
sources: www.entrepreneur.com.ph, www.mb.com.ph