TRADE Secretary Ramon Lopez yesterday said reforms will continue to be pursued to attract foreign investments, jumpstart the economy and recover from the impact of the new coronavirus disease pandemic.
Lopez in a webinar organized by various European business organizations yesterday also said sectors like construction, industries, agriculture and services would bounce back by next year to take the country to a recovery phase.
Lopez also told the foreign businessmen the country may move to a general community quarantine (GCQ) by June 1 if the capability of the health system to handle the pandemic improves further.
Lopez said government will pursue the liberalization of retail and will be more flexible in granting incentives under the Corporate Income Tax and Incentives Reform Act (CITIRA),
Specifically, Lopez said high-performing export companies will be granted a longer transition of seven years to enjoy the current gross income earned tax rate before shifting to corporate income tax rate. Earlier proposals pegged the transition at either two or five years.
The chambers had cited the pendency of the CITIRA has dampened foreign investments in the Philippines.
Lopez said discussions on CITIRA will resume at the Senate next week.
“This (CITIRA) is one thing we’d like to pass to attract investments. Incentives will not be taken away, in fact they (investors) will get longer income tax holiday followed by a number of years of lower CIT as well as more deductions – for direct labor, infrastructure, research and development and local content – to arrive at a lower tax due. There will be more incentives, we’re just putting a cap,” Lopez said.
Lopez remains optimistic some sectors will take the Philippines to recovery starting next year.
He sees construction to grow by double-digit rate pushed by the aggressive
implementation of the Build, Build Build.
In industry, Lopez said he sees manufacturing registering 4 to 5 percent growth while services, which has been growing 5.5 to 6 percent in the past, would even grow faster, .
Lopez is bullish the agriculture sector would bounce back at 2 percent growth fuelled by value-adding, productivity and modernization programs in the sector.
When asked if areas under modified enhanced community quarantine like Metro Manila would move to GCQ after May 31, Lopez said that would still depend on the number of ICU beds, isolation rooms and testing facilities.
“We are still close to the warning zones in terms of ICU beds, isolation rooms, testing capacities. If all things improve, a GCQ achievable by June onwards. For us we would like to open (more sectors),” he said.
