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Home News National

Salceda: Work from home for call centers

Maricel CruzbyMaricel Cruz
May 20, 2021, 11:30 pm
in National
Reading Time: 2 mins read
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Albay Rep. Joey Salceda on Thursday expressed support for the call to allow business process outsourcing (BPO) enterprises to keep the work-from-home arrangements and to allow the same in the implementing rules of the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act.

In a letter to IT & Business Process Association of the Philippines (IBPAP) president Rey Untal, Salceda said the “intention of the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act was to ensure that Philippine enterprises are competitive.”

Untal earlier asked Salceda to relax the rule under Section 309 of the tax code as amended by CREATE.

The condition under Section 309 is that the activity must be “conducted or operated within the geographical boundaries of the zone or free port being administered by the Investment Promotion Agency in which the project or activity is registered.”

“This appears to me to be relevant for industries that require physical transport and storage and are therefore prone to smuggling and leakage to the domestic market. Smuggling is not a BPO-sector problem,” Salceda said.

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“Unless there is a contrary Department of Finance or Bureau of Internal Revenue opinion or overriding argument, I tentatively support your request on this matter,” Salceda said.

“For industries that make use of the virtual space, a strict interpretation of Section 309 would lead to such absurd questions as ‘Are the airwaves part of the geographical boundaries of the zone?’ or ‘When a BPO service is transmitted and/or stored through facilities outside the zone, does this count as a violation of the provision?’”

“The complete process of rendering the service of a BPO does not happen exclusively within the boundaries of the zone, even if the workers are onsite. It appears to me that if the service is orchestrated in the ecozone by the BPO, Section 309 can be fully complied with,” Salceda added.

“I am thus inclined to support your request. However, as Chairman of the House Ways and Means Committee, it is important to me that I hear from the Bureau of Internal Revenue (BIR) or the Department of Finance (DOF) about whether such a hybrid arrangement can be abused to minimize or evade taxes,” Salceda assured IBPAP in the letter.

Tags: BPObusiness process outsourcingcall centersCorporate Recovery and Tax Incentives for EnterprisesCREATE ActRep. Joey SalcedaWork from home
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Maricel Cruz

Maricel Cruz

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