Incentives for CJH locators not yet possible

TAX INCENTIVES to investors in Baguio might not apply yet due to pending amendments to the city's investments and investments ordinance.

Reacting over plans of implementing the incentives code to locators of Camp John Hay (CJH), which were recently ordered by the court to get their business permits from the City Government, Councilor Elaine Sembrano said Mayor Reinaldo Bautista Jr. has technically vetoed the ordinance when he proposed an amendment to the code.

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"In effect, there are no tax incentives to speak of as the entitlements, which the city may grant to CJH locators as incentives [in pursuit of] a regulatory ordinance," Sembrano said in a press statement.

On May 2008, the mayor returned unsigned Ordinance 35-2008 to the City Council. The mayor said the council's approval of the ordinance is laudable but said the Baguio Investment and Incentive Board gives undue delegation of powers both executive and legislative to the Board.

But the council, when it passed the Code on April 2008, said the mayor's comment came 12 days after they passed the ordinance. As per the law, the mayor is given ten days to approve or veto an ordinance otherwise the measure is considered approved.

During its session, the council instead considered the mayor's observation as an amendment to the ordinance.

The same was referred to the City Council committee on laws.

In the meantime, Sembrano said what the mayor may consider is to enforce business regulations which the city has inherent authority to apply. "To treat these business locators in a special way is without legal basis and can be seen as an undue exercise of business regulatory authority, in excess of what is authorized under existing laws. It is likewise tantamount to causing undue disadvantage to city interests."

The Incentives Code aims to boost the city's program to attract investors and provide incentives to industries contributing to the city's development.

As per the ordinance, the city will implement an investment priorities plan where the city will employ a registration system to ensure the business would be economically, technically and financially viable.
Among incentives to be provided new businesses include exemption from payment of mayor's permit, building permit, business sales and real property taxes.