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VAT eyed as subsidy for power cost of exporters outside PEZA

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By Joel Guinto
First Posted 16:46:00 09/11/2008

MANILA, Philippines — The government is considering using the Value Added Tax (VAT) collections to subsidize the electricity cost of export firms operating outside economic zones, Trade Secretary Peter Favila said.

Another option is to ask the National Power Corp. (Napocor) to shoulder the subsidy, Favila told a news conference in Malacañang.

Favila did not say how much the subsidy would be, but in an earlier Cabinet meeting, President Gloria Macapagal-Arroyo said she was willing to provide a P1-bilion development fund for exporters to spur job creation.

“One [option] is to tap what [Finance] Secretary Teves is putting in place. This is the industry competitiveness fund. Where will this be sourced? The VAT collections,” Favila said.

“This is being worked out. We are committed to deliver on that appeal [from] export enterprises outside eco zones,” he added.

Firms operating inside Philippine Economic Zone Authority (PEZA) zones enjoy lower power rates.

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Written by joelguinto

ThuUTC2008-09-11T09:11:09+00:00UTC09bUTCThu, 11 Sep 2008 09:11:09 +0000 22, 2006 at 12:45 am09

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