December 6th, 2021
House Ways and Means Chair Joey Sarte Salceda (Albay, 2nd district) called on the Department of Trade and Industry (DTI) to finish the Strategic Investment Priorities Plan (SIPP) mandated under the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act before March 2022, the first anniversary of the measure, during the tax panel’s regular Monday meeting today.
“This has gone on for longer than it should have. Invoking this committee’s oversight power over Title XIII of the tax code, I strongly urge DTI to get it done as soon as possible, and definitely before CREATE turns one,” Salceda said.
The SIPP is the list of industries that are eligible for tax incentives under the CREATE Act.
Salceda says that as a result of not having the SIPP finished, industries are still unsure about the tax incentives they will receive in the country. Salceda adds that “the FIRB is unable to determine the tiering of the incentives, because the Investment Priorities Plan, which was carried over as a transitional SIPP, does not provide for tiering.”
“It’s complicating the process. An initial list should have been issued long ago,” Salceda said.
Salceda also recalled that the DTI submitted an initial list of industry tiers for the consideration of the House of Representatives during the bicameral proceedings for CREATE, but the list was not hardcoded in the final text of the reform.
“That is why I insisted on that listing. It ends uncertainty and gives investors a sense of what they are bound to get under our laws. FDIs are growing year on year, but we’re not maximizing our potential for investments because investors still have no idea if they qualify for better incentives under our law.”
“The pain is mostly on high-tech industries that we really need. They are still unable to avail of the highest level of incentives under CREATE. That is a problem and a massive waste during a boom in the digital economy.”
Salceda also requested the DTI to “already submit the initial list sent to the House of Representatives as the first version of the SIPP. We can approve additions on a case-to-case basis, as our neighbors do anyway.”
“If we want CREATE to succeed, we have to get that list out now,” Salceda said.
Salceda also said that the panel of experts that the DTI is consulting with over the SIPP drafting process should finish faster.
“There’s a time for consultation and there is a time for decisions. This crisis is a time for decisions. Anyway, nothing is stopping us from revising the SIPP if the initial list needs improvements. Just change the air now by getting the SIPP done.”
“Otherwise, the FIRB will find it hard to determine which incentives to award, the investors are unable to make financial projections, and everybody loses in the end.”
“Let’s make this law work. The deadline I will insist on, when it comes to issuing the SIPP, is March 2022. Otherwise, I will be forced to call oversight hearings,” Salceda said.