Triple I recently had a meeting with the Board of Investments to discuss the current foreign investments in the Philippines and the perspectives of the governmental agency for the near future.Our main goal: to find out who are the top investors and what are positive perspectives and tax incentives for foreign companies according to the governmental agency.
The meeting was held at the International Investments Promotion Service (IIPS), a department of the BOI focused on the establishment and strengthening of commercial relations with Asian countries and other continents. The IIPS is strongly working on the development of business between Philippines and the Americas, Middle Eastern and Asia Pacific countries.
The Board of Investments promotes mainly foreign investments in the local manufacturing industry. During its presentation, the BOI informed that the top investors in the country remain being the United States and Japan. The latter one, as one of the biggest Philippine’s partners in general commercial and trading relations, has nearly half of its investments in the manufacturing industry. We recently wrote a blog post explaining Why Japanese Companies are setting up business in the Philippines.
Another Asian country that has been greatly increasing its presence in the local business environment is Singapore. According to IIPS, Singaporean investments increased 100% in the last few years, which led to the establishment of an International Enterprise Center in Manila in 2014.
Aside from the assistance to companies locally established, the BOI also presents the advantages and incentives to companies through the Philippine Trade & Investment Centres, which are attached to some embassies abroad. These contact people provide an overview of the Philippine business environment and refer to professional and local consulting firms such as Triple I to assist in their business needs.
Economic Zones & Tax incentives
Although the Philippines remain a difficult country to do business, the BOI highlighted the government investments in developing a better infrastructure and the promotion of Economic Zones which includes:
- 68 Manufacturing EcoZones;
- 209 IT Parks and Centers;
- 19 Agro-Industrial EcoZones;
- 19 Tourism EcoZones;
- 2 Medical Zones;
Several companies have also been looking for Tax incentives promoted by the Board of Investments and the Philippine Economic Zone Authority (PEZA). BOI offers to accredited companies Income Tax Holiday (ITH) of 4 to 6 years and Income Tax Holiday Bonus (ITH) of 3 years if the firm meets specific conditions.
Importation of capital equipment, spare parts and supplies receive 0% duty and importation of raw materials and supplies used in export are granted a tax credit. Additional benefits are the zero Value Added Tax (VAT) for export products and the immigration benefits for foreign nationals – a Special Non-Immigrant Working Visa within 5 years from project’s registration including dependents.
If your company is planning to incorporate its business in the Philippines or wish to apply for a BOI accreditation, don’t hesitate to contact us. With some of the most experienced Business Consultants Analysts in the country, Triple I can assist you and provide a smooth incorporation process to facilitate your business.