The Fiscal Incentives Review Board (FIRB) has approved the grant of tax incentives for a proposed P10-billion cement manufacturing project of Pro Cement Industries Corp. of conglomerate San Miguel Corp. in Davao del Sur, the Department of Finance (DOF) said yesterday.
In a statement, the DOF said the project is estimated to produce around 50.4 million cement bags per year to help meet the growing infrastructure requirements in Mindanao.
Oro Cemento’s application for tax incentives was approved by the FIRB last Dec. 15, 2021 during the 10th FIRB board meeting, according to Carlos Dominguez, DOF secretary.
Voting unanimously, the FIRB board approved the grant of a two-year income tax holiday, followed by five years of enhanced deductions, and duty exemption on importations of capital equipment, raw materials, spare parts or accessories for the project, which is set to start commercial operations in July this year in Sta. Cruz, Davao del Sur.
Meanwhile, Ramon Lopez, trade secretary and FIRB co-chair, said approving the grant of incentives will “help achieve the country’s goal of reducing dependence on cement imports and stabilizing the price and supply of the product, on top of the economic benefits of more jobs and business activity generated by the project.”
The DOF said in deciding on the application, FIRB took into consideration the costs and benefits of granting incentives to the project.
Juvy Danofrata, DOF assistant secretary and FIRB secretariat head, said the projected direct and indirect benefits from the project outweigh its projected costs, which include the foregone revenues from the tax incentives.
The project is expected to stimulate forward linkages, promote the use of energy-efficient equipment that can lead to a transfer of knowledge and improvement in productivity, especially in the underdeveloped area where the project is located, the DOF said.
