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BPO firms to return to on-site work on April 1 as FIRB denies WFH extension

Information technology-business process management (IT-BPM) companies would have to require their entire workforce to return to office by April 1 as the Fiscal Incentives Review Board (FIRB) thumbed down requests to extend remote-work arrangements.

In a statement on Wednesday, the Department of Finance (DOF) said the inter-agency FIRB has upheld its Resolution No, 19-21, which allows IT-BPM firms in economic zones to implement work-from-home (WFH) arrangements for 90% of their workforce only until March 31, 2022.

The decision of the Cabinet-level inter-agency board, during its February 21 meeting, to stand by its Resolution No. 19-21 “denies the request of certain groups to implement extensions to the adoption of the WFH arrangement for the IT-BPM sector until after March 2022,” according to the DOF.

To recall, the Philippine Economic Zone Authority (PEZA), an investment promotion agency where several IT-BPM firms are locating to enjoy fiscal incentives, has been pushing to extend the WFH arrangements for companies located in economic zones until September 12, 2022.

The decision of the inter-agency body to deny requests for extension and uphold its earlier resolution mean that IT-BPM firms’ workers should return for on-site duty beginning April 1, 2022.

“The WFH arrangement is only a time-bound temporary measure adopted during the surge of the Covid-19 pandemic. Given the increasing vaccination rate of Filipinos nationwide, we can now undertake safe measures for physical reporting of employees, including those working in the IT-BPM firms operating within ecozones and freeports,” said Finance Secretary and FIRB chairman Carlos Dominguez III.

“The employees’ return to the office would provide more opportunities and pave the way for the recovery of local micro, small, and medium enterprises (MSMEs) that depend on IT-BPM employees for their livelihood,” added Dominguez.

Firms located in economic zones that fail to comply with the FIRB's rules cannot enjoy fiscal incentives such as income tax holidays and 5% tax on gross income earned.

The FIRB also disapproved the request for the lifting of the moratorium on ecozone development in Metro Manila, the DOF said.

The Board stood firm on the Duterte administration’s thrust to increase investments outside Metro Manila, and emphasized that Administrative Order (AO) No. 18 still complements the government’s strategies and policies on rural development, aligned with the objectives of the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act, according to the Finance department.—AOL, GMA News