Tuesday, May 24, 2022
HomeCustoms & TradeP17B Subic shipyard project gets tax incentives

P17B Subic shipyard project gets tax incentives

  • P17B Subic shipyard project gets tax incentives
  • Project AGILA gets tax incentives for the redevelopment and operation of the former Hanjin shipyard in Subic Bay Freeport Zone
  • The Fiscal Incentives Review Board granted the project special corporate income tax, VAT exemption for imports, VAT zero rating on local purchases, and duty-free imports

A P17-billion Subic shipyard project received tax incentives from the Fiscal Incentives Review Board (FIRB).

At the endorsement of the Subic Bay Metropolitan Authority (SBMA), FIRB approved the grant of tax incentives to Project AGILA for the redevelopment and operation of the former Hanjin shipyard in the Subic Bay Freeport Zone.

The project is funded by US-based private equity firm Cerberus Capital Management.

READ: Cerberus acquires Hanjin’s Subic shipyard for $300M

Finance Secretary and FIRB Chairman Carlos Dominguez III supported the approval of tax perks for Project AGILA, as the former Hanjin shipyard’s rehabilitation presents economic potential due to its strategic location near the West Philippine Sea.

The project was granted special corporate income tax, value-added tax exemption for importations, VAT zero-rating on local purchases, and duty-free importation.

“We expect the project to create jobs in the adjacent communities, increase economic activity as well as support the national government’s economic recovery efforts,” Dominguez said in a statement.

“The resumption of operations in the shipyard will also prompt development and productivity in the area, which can attract more investment opportunities into the country,” he added.

The project will also cater to both the Philippine Navy and potential export locators.

The FIRB said the project will be beneficial, specifically to the Navy, as it will involve the safety and efficiency of the Philippine government ships’ performance and, consequently, strengthen national security.

SBMA chair and administrator Rolen Paulino Sr. earlier said Cerberus Capital Management and Agila NY Naval Inc./Agila South Inc. will take over the former Hanjin shipyard.

The 300-hectare area to be taken over was once occupied by South Korean shipbuilder Hanjin Heavy Industries and Construction-Philippines Inc. Hanjin had been Subic’s biggest locator before it went bankrupt in 2019.

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