BOI Trimming CPFPC Tax Incentives
After strong pressure from the domestic industry, the Board of Investments is considering of reducing the income tax incentives granted to Thai-owned Charoen Pokphand Foods Philippines Corporation (CPFPC) to four years from fix years.
Outgoing Trade and Industry Undersecretary Cristino L. Panlilio told reporters the BOI might withdraw the pioneer status to CPFPC by reclassifying it into a non-pioneer. A pioneer project entitles the proponent six years of income tax holiday while a non-pioneer grants only four years of ITH.
"It was a pioneer because of the volume of its investments of over $200 million," Panlilio noted. A sheer magnitude of investments is one of the qualifications for a project to be granted pioneer status. But, Panlilio said such policy is "not carved in stone."
Panlilio said that CPFPC appeared to be amenable of their investments being reclassified to non-pioneer and getting lesser incentives.
"I think they (CPFPC) can understand the situation. It can also happen in Thailand. They can also do every thing to prevent foreign investments from coming in. They (Thailand) invite a lot of foreign investments but they also know how to protect their existing viable industries," Panlilio said.
He, however, said the huge investment of the Thai firm is a huge one that is difficult to fill.
If ever, there are certain domestic companies that may be displaced by CPFPC he was certain they could find other better things to do.
He said that CPFPC's entry into the country was meant to take advantage of cheaper labor force and the good economies of scale given the huge domestic market for pork and chicken.
Last year, the domestic aqua feeds producers led by the National Federation of Hog Farmers and Bounty Fresh raised arms against the BOI decision to grant CPFPC's P2. …