The Philippine Economic Zone Authority (PEZA) will ask the Fiscal Incentives Review Board (FIRB) for the waiver of penalties slapped on companies which breach the 30-percent limit of employees working offsite, according to Tereso Panga, PEZA officer-in-charge director-general.
Panga said PEZA can propose since the Philippines is still into national state of calamity.
FIRB can withdraw fiscal and non-fiscal incentives of companies if they breach the 30 percent work-from-home (WFH) limit.
However, Panga said penalties prescribed by PEZA in letters of authority issued to locators to allow them to adopt WFH will apply.
According to Panga, PEZA met recently with the technical working group of the FIRB to iron out the stringent penalties and conditions imposed by the Bureau of Internal Revenue and the Bureau of Customs that are inconsistent with the Corporate Recovery and Tax Incentives for Enterprises and and FIRB resolutions, and which were issued without prior consultation with the investment promotion agencies. “This regulatory incoherence will surely impact on the viability of existing and prospective IT (information technology) investors of PEZA,” said Panga.
He said PEZA is banking on the support of Trade Secretary Alfredo Pascual, chairman of the PEZA board and the FIRB to sustain the industry’s appeal.
He noted some senators are pushing for the liberalization of the WFH policy so that PEZA locators can keep their incentives while availing of flexible work arrangements and as a measure to attract more investments into the country.
“We feel government can be more proactive and responsive to the needs of ecozone locators if it will extend to them the WFH privileges under a hybrid work set-up,” Panga said.
He added this will put PEZA on equal footing with the Board of Investments – where no WFH cap is imposed – since both agencies offer the same incentives to their registered business enterprises, whether they are domestic or export-oriented.
Panga said this will also make the Philippines at pace with India and other forward-thinking economies that have adopted WFH and hybrid work as the new normal. – Irma Isip