Sun.Star: PEZA office in Clark closes

Some 31 export firms were placed back under the jurisdiction of the Clark Development Corp. (CDC) with the closure of the Philippine Economic Zone Authority (PEZA). Sun-Star Pampanga reported Monday that the PEZA’s closure in Pampang was part of the transformation of the area from an economic zone into a free port. CDC officials led by president Levy Laus expressed gratitude to PEZA for temporarily administering tax incentives and duty free privileges to the 31 firms. The 31 firms were initially affected by a Supreme Court (SC) ruling that nullified such benefits. PEZA director general Lilia de Lima ordered the closure of her office in the area starting Saturday. The agency turned over jurisdiction of the 31 firms to CDC in accordance with Republic Act (RA) 9400, which President Gloria Macapagal Arroyo signed into law earlier this year. RA 9400 restored the tax and other incentives of locators there and other former US military facilities in the country. In 2005, the Supreme Court ruled out that only Subic Freeport was entitled to such tariff privileges. The court also ruled that the locators here and in the other former-US facilities, except Subic, should pay back taxes to the government. But with the passage of RA 9400 and another related law, tax amnesty was granted for locators and other areas. The export companies in Clark were placed under PEZA jurisdiction to avoid disrupting their operations. The completion of the implementing rules and regulations for RA 9400 finalized the order to again place the 31 firms under CDC jurisdiction. Bernardo Angeles Jr, manager of CDC Customer Service and Contracts Administration Department, assured the proper transition and unhampered operations of the companies. Angeles said he already met with Peza and customs officials here. The law states that the Clark Freeport shall be operated and managed as a separate customs territory ensuring free flow of goods as well as provide incentives such as duty-free importation of raw materials and capital equipment. It also provides that export or removal of goods from Clark to other parts of the country will also be subjected to customs duties and taxes. Under RA 9400, investors are exempted from the usual national and local taxes but would instead pay the government five percent of their gross income earned (GIE). Three of the five percent would be paid to the national government, while the remaining two percent would be paid to the local government. - GMANews.TV