BASED ON CHATTO LAW
BY VEN REBO ARIGO
Pres. Rodrigo Duterte has signed a law extending for another 10 years the granting of incentives by the Tourism Infrastructure and Enterprise Zone Authority (TIEZA) to the tourism enterprise zones (TEZ).
According to the Philippine Star report today, the president signed Republic Act 11362 which amended Section 85 and 103 of RA 9593 or the National Tourism Act of 2009.
Considered in the industry as the bible of Philippine tourism, the RA 9593 was principally authored at the House of Representatives by Gov. Edgar Chatto who was then Bohol’s First District congressman.
“The incentive scheme set forth in Sections 86, 87 and 88 of Republic Act 9593 shall be in effect until Dec. 31, 2029, subject to review by the Joint Congressional Oversight Committee,” the amended law reads.
Further, RA 11362 amended Section 103 of RA 9593 by adding the chairperson of the Committees on Ways and Means of both Houses of Congress to the Joint Congressional Oversight Committee.
Based on RA 9593, the TEZ developers and tourism enterprises will get incentives that include a six-year income tax holiday that may be extended for another six years; a five percent preferential tax on gross income in lieu of national taxes, except for real property tax and fees of TIEZA; a net operating loss carryover scheme; import tax exemptions for capital goods and equipment needed for TIEZA-registered activities; and import tax exemptions for transport equipment and spare parts needed for TIEZA-registered activities.
They will also be exempted from value-added tax and excise tax goods imported by TIEZA-registered activities, tax credit equivalent to taxes paid on locally sourced goods, and tax deduction of up to 50 percent of cost of environmental protection and cultural heritage preservation activities as well as of sustainable livelihood programs of the registered tourism enterprises.
In 2017, the Bureau of Internal Revenue (BIR) clarified that the incentives for TEZ under RA 9593 may be enjoyed by investors even beyond 2019 until these incentives are fully realized.
Chatto had principally authored the National Tourism Act of 2009 when he was also the chairman of the Committee on Tourism of the Lower House.
The Upper House version of RA 9593 was principally authored by Chatto’s counterpart in the Senate, Richard Gordon.
RA 9593 or the National Tourism Act of 2009 has, thus, since been also known as the Gordon-Chatto Law.
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Topic: TIEZA Incentive Scheme (Read 938 times)