The Philippine Economic Zone Authority (PEZA) will welcome with open arms if San Miguel Corp. (SMC) will apply as developer of a special economic zone within its sprawling Bulacan Airport property, but the agency said it will still be subject to Malacanang approval and the Fiscal Incentives Review Board (FIRB).
“If Bulacan Airport will apply with PEZA, we can accept their application following the criteria and parameters provided in the Corporate Recovery and Tax Incentives for Enterprises (CREATE) law and Strategic Investment Priority Plan, but we will listen first to PBBM’s plans” said PEZA Director General Charito B. Plaza.
On Friday, July 1, President Ferdinand R. Marcos Jr. vetoed the bill creating the Bulacan Airport City Special Economic Zone citing fiscal risks. This was his very first major decision since he took office on Thursday, June 30.
In his veto message, Marcos said that while he recognizes the aim of House Bill No. 7575 to accelerate local economic growth, "fiscal prudence must be exercised particularly at times when resources are scarce, and needs are abundant."
"l cannot support the bill considering the provisions that pose substantial fiscal risks to the country and its infringement on or conflict with other agencies' mandates and authorities," the President wrote.
Plaza explained that should SMC decides to apply with PEZA, it will have to be approved by the FIRB given the sheer magnitude of the investment.
Under the PEZA processes, a company has to apply for registration as an ecozone developer. Once approved, PEZA will submit to Malacanang its recommendation for the Presidential Proclamation of the project as a special economic zone.
Plaza said that “an aerotropolis is a good model for them” and the ecozone could serve as logistics and transportation hub, warehouses, and manufacturing with commercial, residential, industrial areas designed into townships.
Under the CREATE Law, the FIRB will also have a final say as to the granting of tax and fiscal incentives, which include income tax holidays for a certain period of years.
The President has also the power to grant incentives based on the positive recommendation of the FIRB and upon satisfactory determination of the project’s comprehensive sustainable development plan with clear inclusive business approaches, and high-level sophistication and innovation, and minimum investment capital of P50 billion or its equivalent in US dollars or a minimum direct local employment generation of at least 10,000 within three years from the issuance of the certificate of registration.
The planned Bulacan airport special ecozone is a crucial component of the ambitious international airport of SMC on a 2,500-hectare property in Bulacan with $15-billion worth of investments.