Wednesday, July 05, 2006
Pact inked to hasten micro business implementation
WITH the varied interpretation of government agencies of the implementing rules and regulations (IRR) of Barangay Micro Business Enterprises (BMBE) Act of 2002, five government agencies in the Davao Region recently signed a memorandum of agreement to hasten the implementation of the said law.
The regional offices of the Department of Trade and Industry (DTI), Bureau of Internal Revenue (BIR), Department of Labor and Employment (Dole), Department of Interior and Local Government (DILG), and Philippine Information Agency (PIA) will collaboratively ensure the smooth implementation of the BMBE Law.
The Republic Act 9178, otherwise known as BMBE Act of 2002, is a law that promotes the establishment of BMBEs by providing them with incentives and benefits.
Section 7 of the law states that all BMBEs shall be exempt from tax for income arising from the operations of the enterprise. The local government units are encouraged either to reduce the amount of local taxes, fees and charges imposed or to exempt BMBEs from local taxes, fees and charges.
Section 8, on the other hand, says that the BMBEs shall be exempt from the coverage of the Minimum Wage Law provided that all employees covered under this Act shall be entitled to the same benefits given to any regular employee such as social security and healthcare benefits.
These are just few of the many incentives that BMBEs can get with the passage of the law.
Under RA 9178, BMBEs refer to any business entity or enterprise engaged in the production, processing or manufacturing of products or commodities, including agro-processing, trading and services, whose total assets including those arising from loans but exclusive of the land on which the particular business entity's office, plant and equipment are situated, shall not be more than P3 million.
DTI regional director for Southern Mindanao Merly M. Cruz said strengthening of the law implementation in the region will bring in those enterprises that are in the underground economy and informal sector into the mainstream economy.
She added that currently, there are claims from the registered BMBEs that they are having a hard time availing of the benefits and incentives, particularly that of the income tax exemption, not to mention the lack of adequate knowledge on the contents and benefits of the law, and the absence of mechanism for registration or the lack of information on the registration procedures and documentary requirements.
BMBEs as defined under RA 9178 shall first register with the Office of the Treasurer of each city or municipality where its principal place of business is located, subject to certain qualifications and requirements.
For further inquiries about RA 9178, please contact DTI 11 at (082) 224-0511.
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