On March 15, 2023, the Fiscal Incentives Review Board (FIRB) released Advisory 005-2023, which provides an extended period for Registered Business Enterprises (RBEs) in the Information Technology–Business Process Management (IT-BPM) sector, allowing them to move equipment and other assets outside the economic zone or freeport zone without being required to post any bond. This provision applies specifically to RBEs that have transferred their registration to the Board of Investments (BOI).
The said bond-free period is extended from March 31, 2023 to June 30, 2023. The extension aims to give IT-BPM RBEs additional time to process the Tax Exemption Indorsement (TEI) from the Department of Finance–Revenue Office (DOF-RO) for existing goods imported as of January 31, 2023. For new capital equipment imported starting February 1, 2023, assets that are intended to be moved out of or are currently outside the economic zones and/or freeport zones must be covered by a TEI. The TEI is a document issued by the DOF that determines whether imported goods are exempt from payment of duties and/or taxes.
Only covered RBEs registered with the BOI, as evidenced by the related BOI Certificate of Registration and/or the corresponding official receipt, representing the payment of the registration fee, will be authorized to move their existing capital equipment and other assets, related to the registered IT-BPM project or activity with the BOI, within and outside the economic or freeport zones. Such movement of existing goods imported as of January 31, 2023, must be documented through a provisional goods declaration, as supported by a notarized undertaking that the related TEI will be secured, in lieu of posting any type of bond and during the pendency of the TEI.
Once the TEI has been secured, no bond requirement in whatever form shall be imposed for the transfer or movement of equipment and other assets outside the economic or freeport zones, provided that the number of equipment or assets of the covered RBEs shall not exceed the number of employees under WFH arrangement. Any excess in the number of equipment or assets thereof shall be subject to the approval from the concerned IPA.
Please be guided accordingly.
Source:
P&A Grant Thornton
Certified Public Accountants
P&A Grant Thornton is the Philippine member firm of Grant Thornton International Ltd.
As published in SunStar Cebu, dated 22 March 2023
