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Duterte vetoes bill on Central Luzon investment, infra hub

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IMAGE FROM BASES CONVERSION AND DEVELOPMENT AUTHORITY

PRESIDENT RODRIGO R. Duterte has rejected the bill creating the Regional Investment and Infrastructure Coordinating Hub of Central Luzon (RICH), citing “substantial fiscal risks” to the economy given its provisions on incentives. “A key to lasting economic development is a tax system with generally low rates and a broad tax base. The subject bill, on the other hand, significantly narrows our tax base with its mandated incentives applicable to registered enterprises in an entire region,” reads a March 13 letter addressed to the Senate and the House of Representatives. The proposed law, contained in Senate Bill 1997 and House Bill No. 8637, provides incentives for 50 years with an option to extend for another 50. “Prolonging such a situation for half a century or more is likely to bring negative revenue and fiscal implications to succeeding administrations and unnecessarily burden future generations,” the letter points out. Under the consolidated bill approved by both chambers of Congress, RICH would lead in the development of the Central Luzon Investment Corridor Master Plan, which would incorporate existing plans for the development of the Subic-Clark and Tarlac areas.