Davao chamber lobbying for Mindanao incentives amid tax reform debate

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DAVAO CITY — The Mindanao business sector will lobby the national government to offer a package of incentives encouraging investors to locate in the country’s southern islands.

Arturo M. Milan, president of the Davao City Chamber of Commerce and Industry, Inc., said the chamber is proposing that Mindanao preferential tax incentives be included in the second round of the Comprehensive Tax Reform Program (CTRP) that is now under deliberation in Congress.

He added that the incentives will be a key topic at the 27th Mindanao Business Conference (MinBizCon) on Sept. 13 to 15 in Tagum City.

“That is why we are supporting the CTRP because we want also that Mindanao should be given preferential tax incentives… This is a way to encourage investments to come to Mindanao,” Mr. Milan said during this week’s Habi at Kape media forum.

“What we want are income tax holidays, (perks for) importing goods (for startup businesses), and other similar incentives… These are the big things that can encourage investments in Mindanao,” he said.

Mr. Milan said that while some local government units have their own incentive codes, they can only offer tax breaks on such items as real property and business registration fees.

“Under the CTRP of the Duterte administration, they are trying to rationalize (taxes), but we don’t want to lose income tax holidays to be given to prospective investors that will locate in Mindanao. We must look at incentives in the right perspective… so that it will benefit areas that need to be developed,” he added.

The Mindanao Development Authority (MinDA) said it will continue to push for an increase in the national budget to propel economic activity.

MinDA Deputy Executive Director Romeo M. Montenegro said it proposed an additional P1.2 trillion for Mindanao spread over the next four years, on top of the regular allocation.

At present, he said, Mindanao gets about 12% of the national budget.

“We have been pushing for a 30% slice for the island… to catch up with the rest of the country,” Mr. Montenegro said, noting in particular the need for more support infrastructure.

He said it is “very easy to justify the increase in the budget for Mindanao” because its six regions —Zamboanga Peninsula, Northern Mindanao, Davao, SOCCSKSARGEN, Caraga, and the ARMM (Autonomous Region in Muslim Mindanao) — have collectively exhibited significant growth in gross regional domestic product (GRDP).

In 2017, Davao, SOCCSKSARGEN (South Cotabato-Cotabato-Sultan Kudarat-Saranggani-General Santos City), and ARMM were among the fastest growing regions in the country, with GRDP growth rates of 10.9%, 8.2%, and 7.3%, respectively. — Carmelito Q. Francisco and Maya M. Padillo