Tax perks only one of foreign investors’ concerns – Habito
While much attention has been given to the next round of the tax reform package, former socioeconomic planning secretary Cielito Habito said that the government needs to address other concerns that are also disadvantageous to the country. Investors are more concerned about the ease of doing business, corruption and infrastructure than they are about tax incentives, said Habito. The BPO sector may need tax incentives as an initial boost, but BPO companies are not here due to tax incentives, they are here because of the human resources in the country. Although the incentives regime is “generous”, it has not made the country competitive in terms of foreign direct investment (FDI), according to Habito. Although FDI inflows totalled a record US$10 billion in 2017, and the total exceeded FDI posted by Thailand and Malaysia, he expressed doubts about the sustainability of the trend. Habito also said government’s ‘Build, Build, Build’ program will be closely watched and might prove a “repellant” to investors if the Philippines shows signs “that we cannot deliver”.
