(Eagle News) — President Rodrigo Duterte has vetoed a bill that would create the Regional Investment and Infrastructure Coordinating Hub of Central Luzon.
In rejecting the bill, Duterte noted several provisions which he said would “pose substantial fiscal risk to the country and are thus inimical to its economic growth” if implemented.
He noted the effect of the bill’s provision on incentives on the tax base.
“A key to lasting economic development is a tax system with generally low rates and a broad tax base. The subject bill, on the other hand, significantly narrows our tax base with its mandated incentives applicable to registered enterprises in an entire region,” Duterte said in his veto message to the Senate and the House of Representatives.
He also noted the effects of the prolonged imposition of such incentives under the proposed law.
The bill provides for incentives of 50 years, and gives the option of extending the imposition of such for another 50.
“Prolonging such a situation for half a century or more is likely to bring negative revenue and fiscal implications to succeeding administrations and unnecessarily burden future generations,”Duterte said.
If implemented, RICH would lead in the development of the Central Luzon Investment Corridor Master Plan for the development of the Subic-Clark and Tarlac areas.