With the goal to formulate sound guidelines on the fees collected by the different investment promotion agencies (IPAs) from their respective registered business enterprises (RBEs), the Fiscal Incentives Review Board (FIRB) has instructed all IPAs to submit a copy of the schedule of rates for their various services relating to the grant and administration of tax incentives to RBE-investors.
The FIRB Secretariat has advised all IPAs in a recent memorandum to submit copies of their respective fees relating to the grant and administration of tax incentives, with the details on their cost recovery and income generation.
This harmonization initiative will adopt the principle under Administrative Order (AO) No. 31 issued by the Office of the President (OP), which mandated that the imposition of fees and charges of the government should be primarily for cost recovery, and should strike a balance between recovering the cost of services and the socio-economic impact of the imposition shall be sought.
Finance Assistant Secretary and FIRB Secretariat Head Juvy Danofrata has said this move was prompted by a directive issued recently by Department of Finance (DOF) Secretary and FIRB Chairman Carlos Dominguez III on harmonizing the schedule of fees collected by IPAs as part of the FIRB’s expanded policy-making and oversight functions in the grant and administration of tax incentives under the CREATE Act .
“The need to evaluate and rationalize fees and charges collected by the IPAs is to ensure that there is equity and shared responsibility between the government and its stakeholders,” Dominguez said in a directive during a recent DOF executive committee (ExeCom) meeting.
He added, “The evaluation of fees and charges are best coordinated with the stakeholders to ensure that the rates are just and reasonable.”
“The guidelines will be drafted based on cost recovery principle subject to reasonable rate of return,” said Danofrata. “Revenue implications will also be considered in the adoption of the guidelines for the setting of fees.”
Danofrata emphasized that “regular consultations with the IPAs will be conducted with their views and suggestions considered to ensure that their schedule of fees and charges are uniform and equitable for all stakeholders.”
-oOo-
