Connect with us

Hi, what are you looking for?

News

Impasse over WFH scheme may hurt PHL’s position as IT-BPM destination

COURTESY OF CONTACT CENTER ASSOCIATION OF THE PHILIPPINES

THE STALEMATE over the work-from-home (WFH) arrangement of registered information technology and business process management (IT-BPM) firms may damage the Philippines’ position as an investment destination, according to the head of an industry group.

IT and Business Process Association of the Philippines (IBPAP) President and Chief Executive Officer Jack Madrid on Tuesday said he found it “perplexing” that the Fiscal Incentives Review Board (FIRB) continues to insist that the extension of the 30% WFH arrangement for IT-BPM firms has no legal basis.

In a statement, he said the FIRB’s stand is “short-sighted and inconsistent with the objective of attracting and retaining investors in the country’s biggest job-generating industry and contributor of foreign exchange revenue.”

“The long-standing impasse with the FIRB and its very public exchanges with PEZA (Philippine Economic Zone Authority) on the matter of WFH/hybrid work is not only detrimental to our narrative of industry agility, innovation and resilience, but also to our positioning of the Philippines as the IT-BPM investment destination of choice,” Mr. Madrid said.

PEZA earlier approved in principle the extension of the arrangement that allows IT-BPM companies to have 30% of its employees work from home and continue to enjoy fiscal incentives under Republic Act No. 11534 or the Corporate Recovery and Tax Incentives for Enterprises (CREATE) law.

Registered business enterprises (RBEs) are mandated to conduct their business within ecozones in order to avail themselves of tax incentives.

The FIRB, which is in charge of granting tax incentives to RBEs, has maintained there is no legal basis to extend the scheme until March 2023. It reiterated the WFH arrangement for IT-BPM firms is allowed only until Sept. 12, 2022.

“The IBPAP stands by the PEZA and its power to enable hybrid work for RBEs. This long-standing policy is irrefutable legal basis for the continuance of the 30% WFH arrangement for IT-BPM companies and the provisions of the PEZA law,” Mr. Madrid said.

He noted the public spat between the FIRB and PEZA has detracted industry players from creating more jobs and generating much-needed foreign exchange revenues.

“This has been a recurring problem that has negatively impacted the ease of doing business in the country, as well as the confidence level of our principals and potential clients,” Mr. Madrid said.

“Considering that this issue is between and among government agencies, we hope that the FIRB threshes this out internally so as not to give the impression to investors of an unstable policy environment, which affects the country’s image. If this continues, IT-BPM’s potential to provide 1.1 million new jobs by 2028 will be seriously imperiled,” he added.

Mr. Madrid said the industry’s push for WFH/hybrid work arrangements is not just part of their business continuity plans amid the pandemic.

“This is more to adopt to global work trends for business flexibility that investors look for and to strengthen our country’s competitiveness in retaining existing and attracting new IT-BPM investors,” he said.

The clamor for WFH arrangement should make the government’s decision even more compelling.

“The least FIRB could do is to explore all possible means by which it can support the continued growth of the industry with all its contribution to the retention and creation of jobs, the generation of significant forex revenue in the two years of the pandemic, including how the industry fuels the recovery and growth of other major industries,” Mr. Madrid said.   

According to the IBPAP, the local IT-BPM industry generated $29.49 billion in revenues in 2021, up by 10.6% from 2020 figures, while total headcount surged by 9.1% to 1.44 million. — Revin Mikhael D. Ochave

Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!

Latest

News

PHILIPPINE STAR/ MICHAEL VARCAS WASHINGTON D.C. — The United States is seeking to form a coalition of countries to drive negotiations on a global...

News

Buildings are seen along EDSA in Quezon City. — PHILIPPINE STAR/ MIGUEL DE GUZMAN By Diego Gabriel C. Robles  THE WORLD BANK (WB) upgraded...

News

Heavy traffic is seen on the southbound lane of EDSA in Cubao, Quezon City. — PHILIPPINE STAR/ MIGUEL DE GUZMAN THE PHILIPPINE auto industry’s...

News

REUTERS THE BANGKO SENTRAL ng Pilipinas (BSP) may deliver a second off-cycle rate hike in early November when the US Federal Reserve is expected...

News

Vendors arrange their goods at a public market in Manila. — PHILIPPINE STAR/ RUSSEL A. PALMA THE ASIAN Development Bank (ADB) is planning to...

Editor’s Pick

With the reversal of the 1.25% rise in National Insurance Contributions happening on the 6th of November, employers across the nation have an opportunity...

You May Also Like

News

BW FILE PHOTO GROSS BORROWINGS by the National Government reached P2.6 trillion as of end-September as it continued to raise funds to respond to...

News

KARASOLAR.COM TENA, Ecuador — Ecuador’s rainforest Achuar people say their ancestors long dreamed of a “fire canoe” or “electric fish” that would let them...

News

REUTERS By Luz Wendy T. Noble, Reporter The country’s foreign exchange buffers slightly increased as of end-October as the value of the central bank’s...

News

COVID-19 has had a significant impact on the mental health of Filipinos across different groups all over the archipelago. From frontline workers, parents balancing...

Disclaimer: Respect Investment.com, its managers, its employees, and assigns (collectively "The Company") do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2022 Respect Investment. All Rights Reserved.