IT-BPO likely to miss job creation target by 40%
Due to tax reform the Information Technology and Business Process Outsourcing (IT-BPO) may this year miss its job creation target by 40 percent. Information Technology and Business Process Association of the Philippines (IBPAP) President and CEO Rey Untal said high-taxes poses a threat to job creation. According to Untal, instead of growing 100,000 a year the industry could only grow by 50,000 or 60,000. Citing a study of the impact of taxes on the BPO industry’s ability to generate employment, Untal said the IT-BPO’s ability to create jobs will be impacted with the impending transition to a corporate income tax (CIT). Select industries enjoy tax investment allowance, five percent gross income earned (GIE) tax and customs duty exemption, among others. Under the proposed second tax reform package, or TRABAHO bill, there will be cutbacks on fiscal incentives granted to ecozone locators by investment promotion agencies.
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