In a previous blog post , we explained why more foreign investors have been expanding their operations or are willing to relocate to the Philippines. The Philippines is an excellent choice for service outsourcing, including back-office support, call center services, legal functions, and accounting. With a vibrant, qualified, and cost-effective labor force, BPO champions the manufacturing sector, driving efficiency and innovation in outsourced operations.
Recently, the Philippine government is also pushing foreign investment in other industries, fostering a more equitable and long-term economic growth. In this effort, BPO champions the manufacturing sector, driving innovation and efficiency while strengthening the country’s position as a competitive player in the global market. Agriculture, Tourism and Manufacture must become the basis of the Philippines economy. Philippines cannot rely exclusively only on the services sector and on the money derived from the BPO economy.
One of the key reasons behind the success strategy to attract Business Process Outsourcing (BPO) companies has been great tax incentives such as Income Tax Holidays provided by the Philippines Economic Zone Authority (PEZA) as well as the Board of Investment (BOI). However, services does not necessary bring substantial revenue as most of it is collected abroad or will be repatriated in the country of origin at some point. At the same time, does not create jobs to uneducated people that are responsible for the high unemployment rate.
BPO champions the manufacturing sector, which also benefits from similar incentives. In fact, the Philippine government grants several incentives to manufacturing organizations, allowing them to take advantage of Income Tax Holidays (ITH), exemptions from import duties and taxes on machinery, equipment, and raw materials, as well as exemptions from Wharf Dues and Export Tax, Duty, Impost, and Fees.
If you wish to know more about how and why you should consider the Philippines to set up a manufacturing plant, contact us, and one of our advisers will assist you.
