Jun 20, 2022

THE chairman of the House Committee on Ways and Means on Monday urged incoming Department of Trade and Industry Secretary Alfredo Pascual to complete the comprehensive Strategic Investment Priorities Plan (SIPP) with assurance that the agriculture sector will receive “generous” tax incentives under the Corporate Recovery and Tax Incentives for Enterprises (CREATE) law. Albay Rep. Joey Sarte Salceda asked Pascual to complete the work undertaken by the Duterte administration in crafting industrial policy by crafting the comprehensive SIPP. SIPP is the list of sectors qualified for tax perks under the CREATE law. According to Salceda, the DTI adopted a three-stage approach to crafting the SIPP, which is the list of industries eligible for tax incentives. The three stages are interim, transitional, and comprehensive SIPP. The current SIPP in effect is meant to be the transitional SIPP. Salceda said he “anticipates a more holistic approach in the comprehensive SIPP, with details on what incentives can be used to spur growth at certain stages of incentivized industries.” He added, “In other words, the comprehensive SIPP will be our country’s top instrument of industrial planning.” He promised to “engage Secretary Pascual on this matter to see how we can craft it in a way that also matches his and the President’s vision for our industries during his term.” Salceda gave assurances that agriculture, being a leading sector needed to push the country’s economic recovery, will receive “generous” tax incentives under the CREATE Act. He said he is “closely working with the Finance, Trade and Industry, and Agriculture Secretaries” to include several agricultural subsectors in the SIPP, the list of industries eligible for tax incentives under CREATE. Salceda explained that “by giving key agriculture sectors tax incentives, we can lower production costs and encourage farm modernization. That will lower consumer prices and boost domestic food supply.” “It’s a positive approach to encouraging domestic food production without choking our own food supply by preventing imports. Besides, preventing importation through trade barriers is unsustainable. There is no substitute for direct and positive support to the agriculture sector,” he said. Salceda cited Meanwhile, DTI has cited Salceda’s contribution to the country’s economic recovery, with the House tax panel chairman being principal author and sponsor of the CREATE Act. DTI Secretary Ramon M. Lopez, in a letter to Salceda dated June 8, said the passage of RA 11536 or the CREATE Act, “laid the groundwork for a new incentive regime and the development of the Strategic Investment Promotion Plan [SIPP] for all investment promotion agencies.” “The DTI and the rest of the Investments Promotion Agencies [IPAs], through the Philippine Investment Promotion Plan [PIPP] membership, are grateful for this strategic promotion tool as we pursue economic recovery efforts,” Lopez’s letter said. It also invited Salceda to an Appreciation Ceremony scheduled on June 27, 2022 at 2pm at the Legazpi 1 Ballroom, 2nd Floor of the Makati Diamond Residences, in Makati City. Signed by President Duterte in March 2021, CREATE Act is considered the largest fiscal stimulus for businesses in the country’s recent history by reforming the corporate income tax and incentives systems. RA 11534 cuts corporate income tax rate to 25 percent from the current 30 percent, retroactive from July 1, 2020.