DOF says IT-BPOs Need to Transfer to BOI for Tax Incentives

Information Technology and Business Processing Outsourcing (IT-BPO) enterprises registered under the  Philippine Economic Zone Authority (PEZA) would be required to transfer to the Board of Investments (BOI) to keep their tax incentives and maintain their current work from home (WFH) arrangement according to the Department of Finance (DOF).

The Department of Finance Secretary Benjamin E. Diokno who heads the Fiscal Incentives Review Board (FIRB) has mentioned that FIRB’s resolution to tackle PEZA IT-BPOs issues regarding hybrid operations with 30% work from home (WFH) and 70% on-site arrangement.

“The FIRB met yesterday [Wednesday, Sept. 14], and we decided there will be a smooth transfer of benefits from the PEZA to BOI so that [the WFH] problem is solved,”  said Secretary Diokno at a Senate briefing regarding the Development Budget Coordination Committee.

With the DOF’s stance, keeping the 30% WFH and 70% on-site arrangement for PEZA-registered IT-BPOs will not be possible due to this not being allowed under the rules of PEZA.

Finance Undersecretary Antonette Tiokno has said that if they would want to still receive tax incentives without the requirement of 100% physical onsite arrangement, they would need to register under the BOI. Under BOI’s rules

“During the interim between now and December, the BPO companies that are registered with PEZA will be allowed to transfer their registration to BOI. However, even if they transfer to the BOI they will be enjoying the same incentives they’ve been enjoying,” said Tiokno.

Tiokno says that “It’s just a registration. They don’t have to physically move.” With the BOI jurisdiction, Tiokno says that the IT-BPOs will not need to be limited by PEZA’s limitations regarding location.

Source: Manila Bulletin