PEZA removing incentives for IT developers

MANILA, Philippines - The Philippine Economic Zone Authority (PEZA) is removing incentives for IT (information technology) developers in Metro Manila and Cebu City, but will continue to offer the same perks to developers in other areas, in a bid to spur development in other parts of the country.

In a resolution, PEZA said that IT projects in the first four PEZA-registered IT parks in Metro Manila such as Eastwood City Cyberpark in Quezon City, Northgate Cyber Zone in Muntinlupa City, Robinson’s Cyberpark along EDSA (Epifanio delos Santos Ave.) and E-Square IT Park in Taguig City, as well as the Cebu I.T. Park will no longer be entitled to incentives.

Elmer San Pascual, PEZA manager for promotions and public relations said in a telephone interview that developers of the IT facilities in Metro Manila and Cebu were given an incentive of having to pay five percent tax on gross income in lieu of national taxes.

“We will be removing that incentive,” he said.

The PEZA said developers or operators of new IT parks and centers to be located outside Metro Manila and Cebu, meanwhile, will continue to enjoy the special five percent tax on gross income incentive.

San Pascual said the move was intended to encourage developers to put up IT facilities in areas outside of Metro Manila and Cebu.

“We want developers to put buildings outside of Metro Manila and Cebu. We want to give employment opportunities in Taytay, in Laguna, in areas outside of Metro Manila and Cebu,” he said.

“We want to disperse the opportunities.”

The PEZA also said in the same resolution that developers of new special economic zones for manufacturing, agro-industrial, and tourism activities, whose area is less than 25 hectares, shall not be entitled to the special five percent tax on gross income incentive.

San Pascual said that while developers of an area less than 25 hectares will not be entitled to incentives, the PEZA can still recommend the site to be proclaimed as an ecozone area.

By being proclaimed a PEZA area, he said, firms that will locate in the site will be able to enjoy incentives. “It will be a come-on for PEZA registered companies like export companies to locate there,” he said.

The resolution will take effect 15 days after its publication in a newspaper.