By Beatriz Marie D. Cruz, Reporter
A LAWMAKER has filed a bill proposing the creation of economic zones in each legislative district in the Philippines to spur economic activity, especially in the provincial regions.
“This measure intends to initiate targeted small-scale economic activity on all legislative districts with the objective to regionalize economic growth and employment boom,” Tarlac Rep. Christian Tell A. Yap said in House Bill No. 9679.
“Despite the positive feedback and significant contribution of ecozones to our economy, much can be done for the Philippines to revitalize the national economy, outcompete our Asian neighbors in attracting foreign investments in strategic industries, and stimulate economic activity in rural and underdeveloped areas,” Mr. Yap said.
Under the proposed law, each legislative district in the Philippines will have at least one Legislative District Economic Zone (LDEZ) in an area of up to 50 hectares.
The economic zones will be entitled to fiscal incentives under the Special Economic Zone Act as well as Executive Order No. 226 as amended, or the Omnibus Investment Code of 1987.
Enterprises registered under the LDEZ may enjoy an income tax holiday or the net operating loss carryover granted by the council prior to the availment of the 5% gross income earned, according to a copy of the bill. The incentives will be granted for up to 20 years.
Business establishments will pay a tax rate of 5% on their gross income, with 3% going to the National Government, 1% to the host province, and 1% to the host city or municipality.
A foreign national who invests $75,000 (P4.18 million) cash or equipment in a registered enterprise will be entitled to an investor’s visa.
An inter-agency council will be tasked to manage and develop the economic zone consistent with the government’s medium-term Philippine development plan. It will also be tasked to establish a one-stop-shop for the registration of enterprises under the proposed LDEZ.
The council will be composed of the governor, district representative, city or municipal mayor or any of their authorized representatives, regional director of the Trade department, and a representative from the Philippine Economic Zone Authority (PEZA).
At present, the bill is pending before the House Committee on Economic Affairs.
The PEZA Board has pre-qualified 25 big-ticket locator projects for the period of July 2022 to November 2023.
The projects are estimated to generate P217.21 billion in investments, $1.5 billion in exports and 16,414 jobs.