PRESIDENT Ferdinand R. Marcos Jr. wants to reduce the powers of the Fiscal Incentives Review Board (FIRB) and restore the mandate of the investment promotion agencies (IPAs) to grant incentives as part of the amendments to the Corporate Recovery and Tax Incentives for Enterprises Act (CREATE), according to a senior lawmaker.
Albay Rep. Joey Sarte Salceda said the Executive Branch has reached a “consensus” to remove the right of the FIRB to grant incentives and restore it within the purview of the IPAs.
“We will restore the powers of IPAs like SBMA [Subic Bay Metropolitan Authority] and PEZA [Philippine Economic Zone Authority]. They are the ones to grant the incentives,” Salceda said in a press briefing on Tuesday.
“It is a consensus policy decision. I get direct instructions from the President to return FIRB back to what it was when it was created—a policy-making body, an oversight body,” Salceda added.
Salceda said they plan to pass the bill restoring the powers of the IPA to grant incentives next month. He noted that a counterpart bill in the Senate has been filed already by Senate President Juan Miguel Zubiri.
Salceda described the CREATE law as a “work in progress,” with lawmakers and policy-makers now seeing the necessary improvements to make the legislation more responsive to the needs of investors.
Salceda added that the forthcoming amendments to the CREATE law are all geared toward addressing the concerns of investors in the country, particularly foreign ones.
Under the Republic Act 11534 or CREATE, the powers and functions of the FIRB were enhanced as part of its oversight mandate.
“The FIRB structure under CREATE ensures that apart from tax subsidies, tax incentives are also granted and monitored properly by relevant agencies,” the FIRB said on its website.
The FIRB was an interagency body created under Presidential Decree 776 in 1975 with the original mandate of “determining what tax should be withdrawn, revoked or suspended under certain fiscal parameters.”
In July, the Department of Finance said the FIRB has approved the grant of incentives to 25 various projects nationwide, with total investments of P287.947 billion during the first year of the Marcos Jr. administration.
The projected amount of incentives or the foregone revenues by the state was at nearly P30 billion. (Related story: https://businessmirror.com.ph/2023/07/31/govt-grants-various-perks-to-projects-of-top-phl-firms/)