By Roy Stephen C. Canivel, Inquirer Business
The government is considering to extend anew the deadline of an ambitious local car production program to match the number of years the country would have been under a COVID-19 state of public health emergency, a top official from the Board of Investments (BOI) said.
Back in April, the BOI said the government would issue an executive order to add another three years to the Comprehensive Automotive Resurgence Strategy (CARS) program, a P27-billion government initiative launched under the Aquino administration that aimed to tap three car manufacturers to locally produce a combined total of 600,000 units within a six-year period.
Only the country’s two market leaders enrolled in the CARS program—Mitsubishi Motors Philippines, which committed to produce Mirage units, and Toyota Motor Philippines, which committed to make Vios units. According to the BOI, their original deadline was set to end in 2023 and 2024, respectively. While the plan is still to give the carmakers time to make up for that which they lost during the pandemic, BOI managing head Ceferino Rodolfo told reporters that the government was considering to recommend “to extend it (the CARS program) with the same duration as the declared state of national emergency.” He said this would still be up for the approval of the Fiscal Incentives Review Board (FIRB), which is chaired by the Department of Finance. This, he said, would also be in line with the the implementing rules of the Corporate Recovery and Tax Incentives for Enterprises Act (CREATE).
The Duterte administration has placed the Philippines in a COVID-19 state of calamity since March 2020.The deadline for the CARS program has been extended three times now, with the latest deadline set for Sept. 12, 2022, or around three months past the term of President Duterte.
The implementing rules and regulations (IRR) of the CREATE law, which cut the corporate income tax and rationalized tax breaks, included a rule on “temporary measures for exceptional circumstances” like a pandemic. It said that an investment promotion agency (IPA) like the BOI, upon approval of the FIRB, could implement temporary measures to support a project’s “recovery from the exceptional circumstance.” This is “provided, that the temporary measures shall cover a specific time period and only be limited to the incentives duly approved by the concerned IPA or the FIRB, as the case may be, under the RBE’s (registered business enterprise) terms and conditions,” the IRR said.
FILE photo shows the launch of the all-new Vios in 2013