Fees charged by investment promotion agencies set for update
The Fiscal Incentives Review Board (FIRB) is drawing up a uniform schedule of fees collected from businesses that are registered with various investment promotion agencies (IPAs), as part of efforts to follow through tax reforms under the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act.
In light of this, the FIRB Secretariat has required all IPAs to submit copies of their respective fees relating to the grant and administration of tax incentives, with the details on their cost recovery and income generation.
According to the Department of Finance, this initiative to harmonize fees is based on the principle that the imposition of such charges should be primarily for cost recovery and should strike a balance between recovering the cost of services and the socio-economic impact of the imposition of the fees.
There are about 20 IPAs, including the Board of Investments, Philippine Economic Zone Authority, Bases Conversion and Development Authority and the various freeport zone authorities.
Included in the functions of these IPAs is the collection of fees and charges relating to the grant and administration of tax incentives to registered investors.
Finance Secretary and FIRB chair Carlos Dominguez III earlier said there was a need to evaluate and rationalize fees and charges collected by the IPAs to ensure that there is equity and shared responsibility between the government and the investors.
Dominguez also said that the evaluation of fees and charges was best coordinated with the investors to ensure that the rates are just and reasonable.
Finance Assistant Secretary Juvy Danofrata, who heads the FIRB Secretariat, said in a statement regular consultations with the IPAs will be conducted with their views and suggestions considered to ensure that their schedule of fees and charges are uniform and equitable for all stakeholders.
“The guidelines will be drafted based on cost recovery principle subject to reasonable rate of return,” said Danofrata.
“Revenue implications will also be considered in the adoption of the guidelines for the setting of fees,” he added.
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