MANILA – The Department of Trade and Industry (DTI) has completed its final draft of the Strategic Investment Priorities Plan (SIPP) of the Corporate Recovery and Tax Incentives for Enterprises (CREATE) law and presented it to the chairman of the House Ways and Means Committee.
Albay Rep. Joey Salceda, committee chair, told this to reporters on Tuesday as the SIPP would allow foreign and domestic investors to apply for tax incentives for their respective sectors.
Salceda said he expects strong foreign direct investment (FDI) performance for the Philippines this 2022, after 2021 was the best FDI performance the country ever recorded.
“2021 was a strong year for FDI, thanks to the prospect of our reforms being finalized. 2022 is when these reforms are actually carried out in full. I expect even better FDI performance this year,” Salceda said.
In his letter to Salceda, DTI Secretary Ramon Lopez credited Salceda’s inputs and support for the finalization of the draft SIPP.
“Following the constructive meeting with you of Undersecretaries Rafaelita Aldaba and Ceferino Rodolfo, we have adopted the Interim-Transitional-Comprehensive Framework approach to the SIPP,” Lopez wrote Salceda.
Lopez also cited the House committee's resolution supporting the framework, which contributed to the approval of the list by the Fiscal Incentives Review Board (FIRB).
“The actual draft was presented to the FIRB Technical Committee on 31 March 2022 as well as to Investment Promotion Agencies 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 Secretaries Lopez and (Finance Secretary Carlos) Dominguez for the work they have done on the SIPP. This will no doubt encourage more investors, particularly in high-value sectors to locate in the Philippines and avail of some of the best incentives in the Asean,” Salceda said.
The CREATE law, which took effect on April 11, 2021, reduced corporate income tax (CIT) from 30 percent to 25 percent for large corporations and to 20 percent for small and medium enterprises that have net taxable income not higher than PHP5 million.
It provides fiscal relief to both domestic and foreign investors doing businesses in the country, a move seen to encourage businessmen to put up domestic operations in a bid to boost economic activities and help in the continued recovery of the economy. (PNA)