Amended code gives more incentives to investors in Davao
DAVAO CITY (MindaNews / 12 December) – The Davao City Investment and Promotions Center (DCIPC) seeks to attract more investors to Davao through an enhanced package of fiscal incentives, following the passage of the amended investment code on Friday.
DCIPC head April Marie Dayap told reporters in an interview that the amended provisions of the 2019 Davao Investment Code offer tax holidays more favorable to businesses investing in the city’s preferred areas of investment.
She explained that the list of businesses eligible for fiscal incentives, such as tax holidays from the local government, has become more comprehensive under the amended investment code “in the hopes of attracting more investors to the city.”
The ordinance amending the code, authored by 3rd District Councilor Myrna Dalodo Ortiz, chairperson of the committee on trade, was approved on third and final reading during a special session held on Friday.
According to Section 30, new projects are granted tax incentives through graduated exemptions from payment of business tax for up to five years – a full exemption during the first three years of commercial operation, a 60% exemption in the fourth year, and a 40% exemption in the fifth year.
It also provides exemptions from basic real property tax for three years, mayor’s permit fees for five years, amusement tax for four years, and land tax on eligible commercial and fruit-bearing tree plantations for up to 10 years.
Before the amendments, tax incentives offered to new investors were only exemptions from business tax for three years, basic real property tax for two years, and mayor’s permit fees for three years.
The new incentive package will be offered to investments in preferred investment areas, such as agri-business; tourism, including sports tourism and halal; light manufacturing; property development; health; education; technology; eco-industry; energy; electric vehicles; infrastructure; and inclusive business activities, including micro small and medium enterprises and social enterprises in Baguio, Calinan, Marilog, and Pacquibato Districts.
During the Mindanao-European Economic Roundtable Discussion at Seda Abreeza on Nov. 18, Christian Cambaya, head of the Investor Assistance and Servicing Unit of DCPIC, said the local government recognized the need to improve current fiscal incentives to catch up with other local government units, such as Taguig, Cebu City, General Santos, and Cagayan de Oro, which offer better incentive packages.
“Local government units all around the country are very competitive. They’re giving enhanced incentives, so we should also be competitive. During our consultations, we found out that the business sector is actually looking for enhanced incentives, so they can recover their investments faster,” he added.
Cambaya said incentives help investors reduce the cost of starting a business, improve cash flow, and enhance the overall viability of the investment projects, making Davao a “smart and cost-effective choice for business expansion.”
He added that non-fiscal incentives extended by the local government to business locators include providing business information, facilitating the processing of local permits and licenses, investment counseling, business matching, and arranging site visits. (Antonio L. Colina IV/MindaNews)
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