The Fiscal Incentives Review Board (FIRB) has approved, upon the recommendation of the Board of Investments (BOI), the grant of tax incentives for a proposed P10-billion cement manufacturing project in Davao del Sur. The project is estimated to produce around 50.4 million cement bags per year to help meet the growing infrastructure requirements in Mindanao.
Voting unanimously, the FIRB board chaired by Finance Secretary Carlos Dominguez III approved the grant of a two-year income tax holiday, followed by 5 years of enhanced deductions, and duty exemption on importations of capital equipment, raw materials, spare parts, or accessories for the project, which is set to start commercial operations in July this year in Sta. Cruz, Davao del Sur.
Trade Secretary and FIRB co-chair Ramon Lopez said that approving the grant of incentives will “help achieve the country’s goal of reducing dependence on cement imports and stabilizing the price and supply of the product, on top of the economic benefits of more jobs and business activity generated by the project.”
In deciding on the application, the FIRB took into consideration the costs and benefits of granting incentives to the project.
Finance Assistant Secretary and FIRB Secretariat head Juvy Danofrata said that the projected direct and indirect benefits from the project outweighs its projected costs, which include the foregone revenues from the tax incentives.
The project is expected to stimulate forward linkages, promote the use of energy-efficient equipment that can lead to a transfer of knowledge and improvement in productivity, especially in the underdeveloped area where the project is located.