The Fiscal Incentives Review Board (FIRB) has approved the grant of tax incentives for a mass housing project and two cement manufacturing plants all located outside Metro Manila worth PHP29.4 billion combined.
These include a mass housing project in Iloilo with an estimated project cost of PHP1.4 billion; a proposed cement plant in Porac, Pampanga, which will cost about PHP3.1 billion; and another cement plant in Calatagan, Batangas which will cost around PHP24.9 billion.
The FIRB approved the grant of a four-year income tax holiday (ITH) plus duty exemptions on importations of capital equipment and raw materials to the Iloilo housing project.
The proposed Pampanga cement manufacturing plant was given a two-year ITH, five years of enhanced deductions and duty-free exemptions on importations, while the one to be built in Batangas, which will include the installation of clinkering facilities, was granted a six-year ITH, along with five years of enhanced deductions and duty exemptions on importations.
Citing estimates from the Board of Investments (BOI), FIRB Secretariat head Juvy Danofrata said the proposed cement manufacturing plant in Pampanga is expected to save the country PHP866 million annually in import expenses, as this would help fill the cement needs of the infrastructure sector by producing this material locally using new cost-effective technologies.
The two-phase project proposed in Batangas would entail higher project costs because it would start from the production of clinkers, which are the most expensive aspect of cement manufacturing, according to Trade Undersecretary and BOI Managing Head Ceferino Rodolfo.
Citing BOI figures, Danofrata said the project’s two phases will be capable of producing a combined total of 2.5 million MT of cement per year.
Lopez said the approval of the cement manufacturing projects will help “lessen the country’s import dependence, increase our local capacity, and encourage competitiveness in the industry.”
Meanwhile, Rodolfo said these projects will help mitigate against supply disruptions of cement in the overseas market and modernize the country’s industrial capacity considering that most cement plants operating here now are already 30 to 40 years old and hence, not power-efficient.