Marikina 2nd district Rep. Stella Quimbo is out to source additional funding for the local footwear, leather goods, and tannery industry saying that additional funds be sourced from a portion of the taxes collected from importing footwear products.
Through House Bill (HB) No. 491, or “An Act Strengthening the Philippine Footwear, Leather Goods and Tannery Industries, Providing Incentives and Funds Therefor, and for Other Purposes,” the lawmaker sought to promote and support the local footwear industry by creating a fund “basically earmarking duties and VAT (value-added tax)” for developing the local industries.
Inquiring about the government’s industrial policy to ensure development of these local industries, Quimbo said finding the fund is the reason why she filed the bill in the first place.
“Kasi kung walang ganung (Because if there is no such) mechanism then talagang (really) we really need to create (a) fund, right?" she told her colleagues and resource speakers during the hearing of the House Committee on Creative Industry and Performing Arts on Tuesday, Oct. 18.
This funding should come from the duties and taxes of imported footwear because it cannot be under the General Appropriations Act (GAA), she maintained.
“In other words, kung kumokolekta ka ng buwis dahil maraming pumasok na (if you are collecting taxes because of the entry of a lot of) imported footwear eh di (then) a portion of that gamitin (should be used) to support our local industry,” the lady solon added.
Quimbo said her bill, which is a proposed amendment to an existing law, will “improve upon the existing law particularly because the developmental incentives in the existing have already lapsed".
After calling out Finance Division Chief Jeanne Guinto for claiming that a “new law” is not needed for what the lawmaker sought to do in the local footwear industry, she explained that there are “many issues” with the existing law, particularly in the procurement section.
“Nagbibigay kayo ng (You give a) statement on the bill without looking into it. Di ba dapat alamin nyo muna kung magkano ini-earmark, magkano ba ‘yan (Shouldn’t you first look into how much is being earmarked, how much is that) historically bago niyo sabhin na '‘Wag,' di po ba (before you say 'No, right)?,” Quimbo said, adding that recommendations from resource persons should be “data-driven".
Marikina is famous for its decades-old shoe-making and leather goods industry.
Guinto told the lawmaker that they are currently “soliciting inputs” on the use of VAT to support the local industries.
If it becomes law, HB 491 will create “developmental incentives” that would provide, among others, “preferential access to financing at flexible loan terms, rebate for investments in modern machineries and equipment and new technologies; rebate for subcontracting to micro, small and medium enterprises (MSMEs) or sourcing of raw materials or services from MSMES; support for marketing, promotional campaigns, fairs, exhibitions and conferences including distribution".
It will also provide “discounted lease rates in government duty-free shops, and other establishments for promotion and sales of the Department of Trade and Industry (DTI), Department of Tourism (DOT), Local Govemment Units (LGUs), and other goverment agencies; access to customs bonded manufacturing warehouse; green lane servicing in business processes with govemment; and assistance on accessing foreign markets, matching with possible foreign partners, market intelligence and other similar support".
Quimbo appealed to the Department of Budget and Management (DBM) and the Department of Finance (DOF) to coordinate with the National Economic and Development Authority (NEDA) and the Department of Trade and Industry (DTI) to submit a position paper on how they can support the local industries.