Call center agents of a business process outsourcing firm (AFP FILE PHOTO)
MANILA, Philippines — The Department of Labor and Employment (DOLE) on Thursday rallied behind calls to provide tax incentives to business process outsourcing (BPO) companies implementing work from home schemes.
Labor Secretary Silvestre Bello III maintained that the BPO industry which is under the Information Technology and Business Process Management (IT-BPM) should be eligible to receive government incentives prescribed in the Corporate Recovery and Tax Incentives for Enterprises (CREATE) law after stakeholders sought DOLE’s position.
The implementing rules and regulations of CREATE law provide temporary measures for exceptional circumstances like the pandemic.
Its provisions, however, still require the approval of the Fiscal Incentives Review Board upon the recommendation of the Investment Promotion Agency, which DOLE is part of.
“As one of the country’s key employment generators, the IT-BPM industry is one of the most important drivers of our economy,” Bello said in a statement.
A provision of the CREATE Act provides that qualified registered products or activities “exclusively conducted or operated within the geographical boundaries of the zone or Freeport” are entitled to corporate recovery and tax incentives.
READ: Why the CREATE Law is a big scam
Bello noted that IT-BPM industries operate within the ecozones even while under work-from-home arrangements: ”Such special working arrangements are recognized under existing DOLE guidelines.”
Bello also maintained that the companies that do not produce physical goods, making them suitable to work from home arrangement “must also enjoy the benefits of the tax incentives provided in the law.”
“We need to provide the industry the support it needs to reach its growth targets and potentials, especially now that we recover from the effects of the pandemic,” Bello added.
The BPO sector generated 1.32 million jobs in 2020, with $26.7 billion (P1.3 trillion) in revenues, according to DOLE.