Recto assures passage of Clark tax perks bills
By Ding Cervantes - The Philippine Star
CLARK FIELD, Pampanga — It’s likely to be a merry Christmas for some 350 investors of the Clark special economic zone, along with their more than 47,000 employees.
This, as Sen. Ralph Recto told The STAR yesterday that there is now a consensus among his colleagues in the Senate to pass "as soon as possible" two bills he sponsored last August to remedy the problems created by the decision of the Supreme Court declaring that the Clark ecozone was not entitled to tax exemption privileges.
"I am confident that the bills will be passed this December, with late January being the worst scenario," he said.
Earlier, reports that the bills would be passed triggered a festive atmosphere among the 47,727 workers of various firms here.
Despite the lack of confirmation from the Clark Development Corp. which runs the ecozone, they passed on text messages telling each other that it was going to be a merry Christmas for them after all.
Senate Bill No. 2259 grants a "one-time tax amnesty" to all Clark investors who, by virtue of the Supreme Court decision, would otherwise be required to pay the usual national and local taxes instead of merely five percent of their gross income earned (GIE).
On the other hand, Senate Bill No. 2260 amends Republic Act No. 7227, or the Bases Conversion and Development Act of 1992, so as to maintain the tax exemption privileges of Clark firms, similarly enjoyed by investors at the Subic Freeport.
The Supreme Court, in its decision on July 29, 2005, ruled that Clark was not specifically mentioned in RA 7227 as being entitled to tax privileges, thus former President Fidel Ramos erred in issuing Executive Order No. 80 granting such perks to Clark investors.
Recto said the two bills have passed the Senate ways and means committee and are up for second reading.
"At this point, I am even willing to entertain individual amendments from my colleagues before the bills are tackled for second reading," he said.
Recto also belied reports that Sen. Sergio Osmeña has been blocking the passage of the bills, which Clark stakeholders said would "put at stake not only the plight of investors but also the livelihood of 45,727 workers they employ."
"He merely wants to scrutinize what happened so that we can avoid cases of erring executive fiats being later corrected by the legislative (branch)," he said.
While the proposed bill on tax amnesty does not cover duty free shops, Recto said he is willing to accept amendments from his colleagues to include them. There are 14 duty free shops operating here.
"But there are two issues that have to be settled on the proposed tax exemptions. One is to limit the privileges only to exporters, exempting those which manufacture for domestic markets or provide domestic services. The other is to classify Clark as a freeport," he said. As freeport, all Clark investors would be entitled to tax perks.
Recto said he is inclined toward the latter, noting that Subic "is a small area" and that once space there becomes scarce, investors would likely shift to Clark.
"I expect the bills to be tackled on the floor this month soon after more amendments are entertained before the second reading," he said.
Last June, the Lower House passed its counterpart bills sponsored by Tarlac Rep. Jesli Lapus, now the education secretary.
The House passed Bills 4901 and 5064 amid threats from Clark investors that they would consider moving to overseas locations due to the Supreme Court decision, which has not been enforced pending an appeal filed by the Clark Development Corp.
Lapus furnished Recto copies of the House bills soon after they were passed, as he expressed hope that the Senate "could accept (them) as they were so we could do away with the bicameral committee hearings."
CLARK FIELD, Pampanga — It’s likely to be a merry Christmas for some 350 investors of the Clark special economic zone, along with their more than 47,000 employees.
This, as Sen. Ralph Recto told The STAR yesterday that there is now a consensus among his colleagues in the Senate to pass "as soon as possible" two bills he sponsored last August to remedy the problems created by the decision of the Supreme Court declaring that the Clark ecozone was not entitled to tax exemption privileges.
"I am confident that the bills will be passed this December, with late January being the worst scenario," he said.
Earlier, reports that the bills would be passed triggered a festive atmosphere among the 47,727 workers of various firms here.
Despite the lack of confirmation from the Clark Development Corp. which runs the ecozone, they passed on text messages telling each other that it was going to be a merry Christmas for them after all.
Senate Bill No. 2259 grants a "one-time tax amnesty" to all Clark investors who, by virtue of the Supreme Court decision, would otherwise be required to pay the usual national and local taxes instead of merely five percent of their gross income earned (GIE).
On the other hand, Senate Bill No. 2260 amends Republic Act No. 7227, or the Bases Conversion and Development Act of 1992, so as to maintain the tax exemption privileges of Clark firms, similarly enjoyed by investors at the Subic Freeport.
The Supreme Court, in its decision on July 29, 2005, ruled that Clark was not specifically mentioned in RA 7227 as being entitled to tax privileges, thus former President Fidel Ramos erred in issuing Executive Order No. 80 granting such perks to Clark investors.
Recto said the two bills have passed the Senate ways and means committee and are up for second reading.
"At this point, I am even willing to entertain individual amendments from my colleagues before the bills are tackled for second reading," he said.
Recto also belied reports that Sen. Sergio Osmeña has been blocking the passage of the bills, which Clark stakeholders said would "put at stake not only the plight of investors but also the livelihood of 45,727 workers they employ."
"He merely wants to scrutinize what happened so that we can avoid cases of erring executive fiats being later corrected by the legislative (branch)," he said.
While the proposed bill on tax amnesty does not cover duty free shops, Recto said he is willing to accept amendments from his colleagues to include them. There are 14 duty free shops operating here.
"But there are two issues that have to be settled on the proposed tax exemptions. One is to limit the privileges only to exporters, exempting those which manufacture for domestic markets or provide domestic services. The other is to classify Clark as a freeport," he said. As freeport, all Clark investors would be entitled to tax perks.
Recto said he is inclined toward the latter, noting that Subic "is a small area" and that once space there becomes scarce, investors would likely shift to Clark.
"I expect the bills to be tackled on the floor this month soon after more amendments are entertained before the second reading," he said.
Last June, the Lower House passed its counterpart bills sponsored by Tarlac Rep. Jesli Lapus, now the education secretary.
The House passed Bills 4901 and 5064 amid threats from Clark investors that they would consider moving to overseas locations due to the Supreme Court decision, which has not been enforced pending an appeal filed by the Clark Development Corp.
Lapus furnished Recto copies of the House bills soon after they were passed, as he expressed hope that the Senate "could accept (them) as they were so we could do away with the bicameral committee hearings."
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