PEZA chief open to hike in GIE perk under TRABAHO bill

“We can increase it to 7 percent. We have been consulting our locators. They are amenable to increase it to 7 percent,” she said during the EU-Philippines Business Summit. (File Photo: Philippine Economic Zone Authority/Facebook)

MANILA — Philippine Economic Zone Authority (PEZA) Director General Charito Plaza on Thursday reiterated her call to legislators not to scrap the gross income earned (GIE) incentive under the Tax Reform for Attracting Better and High-Quality Opportunities or TRABAHO bill, but the agency is willing to increase the tax rate of this perk.

Plaza told reporters that PEZA is amenable to increasing the GIE incentive to 7 percent from the current 5-percent rate.

“We can increase it to 7 percent. We have been consulting our locators. They are amenable to increase it to 7 percent,” she said during the EU-Philippines Business Summit.

Raising the GIE rate could also increase the share of local government units (LGUs) from the taxes of PEZA-registered companies, she added.

Plaza added that in the 5-percent GIE rate, 3 percent goes to the national government, while the remaining 2 percent is for the city or municipality that is hosting the economic zone.

Plaza said by increasing the GIE rate to 7 percent, the provincial government could also gain taxes from PEZA locators.

She said the agency is also amenable to set a period for granting the GIE incentive.

The agency, she said, can provide a perpetual GIE perk to its locators as long as they are operating within the PEZA ecozones.