Wipro Philippines cautious amid incentives rationalization

MANILA, Philippines — Indian business process outsourcing (BPO) firm Wipro Philippines Inc. is taking a cautious stance in expanding operations in the country as it seeks clarity on the proposed  rationalization of incentives.

Wipro Philippines country head Aseem Roy said the firm is slightly conservative with its expansion plan for the next five years as it awaits the final form of the second package of the tax reform program or the Comprehensive Income Tax and Incentive Rationalization Act (CITIRA) bill.

Just like any investor, he said Wipro Philippines would want to see clarity in the proposed changes in the incentives regime.

“You tell us after one year these incentives are gone, then we will plan accordingly because when we sign a deal with a customer, we sign assuming that there is going to be no changes. The tax incentives are going to be there. The income tax holidays are going to be there. So, all we are seeking is the clarity and timeline when it is going to be implemented. Let’s say it is going to be implemented quarter two of 2020, quarter three, help us plan that,” he said.

CITIRA seeks to reduce the country’s corporate income tax rate to 20 percent by 2029 from 30 percent, at present.

The bill also aims to rationalize fiscal incentives which includes putting an end to the five percent tax on gross income earned (GIE) paid by firms registered with the Philippine Economic Zone Authority (PEZA) in lieu of all local and national taxes after the income tax holidays are used up.