GOVT PLUGS REVENUE LOOPHOLES UNDER NEW INVESTMENT SCHEME
MANILA, April 20, 2004 (STAR) By Marianne V. Go - The government continues to plug revenue loopholes under the new Investments Priorities Plan (IPP).
For instance, the manufacture of non-traditional export products with an export capacity of at least 50 percent if Filipino-owned and 70 percent if foreign-owned would still be entitled to incentives under the 2004 IPP.
However, to qualify of incentives, industrial goods for export should have undergone manufacturing, and mineral products for export should have undergone processing.
The 2004 IPP now states that the production of industrial goods involving simple processing would, on the other hand, not be entitled to incentives.
Simple processing is defined as covering any or a combination of activities such as, but no limited to, cleaning, sorting, cutting, shredding, pulverizing, grinding, crushing, compacting, dissolving and filtration.
Similarly, export of recycled materials with no or with simple processing involving any or a combination of activities such as, but no limited to cleaning, sorting, cutting, shredding, pulverizing, grinding, crushing, compacting, dissolving and filtration will no longer be qualified for registration for purposes of incentives.
An additional change to the IPP with regard to exports, specifically in the case of scrap metal, is that the Board of Investments, if national interest requires, may withhold registration of an export product, including industry inputs that are in short supply domestically.
Local metal foundries had been complaining about the unregulated export of scrap metal which is also needed domestically.
Local metal foundries, because of the unhampered export of domestic scrap metal, are forced to import scrap metal making their inputs more expensive.
Reported by: Sol Jose Vanzi
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