The government has granted tax breaks to the operations of a 1.5 billion peso Cebu City-based transport ship project owned by Davao businessman Dennis Uy.
The Tax Incentives Review Board (FIRB) has granted tax incentives for the operations of the carrier vessel specializing in passenger and cargo operations, the Department of Finance (DoF) said in a statement released on Tuesday.
The subsidy includes a four-year tax holiday, five years of increased deductions and 11 years of duty-free imports, he explained.
The agency said the new vessel sails the Cebu-Cagayan de Oro (CDO) route in a shorter time and at a comparable rate, distinguishing itself in the market as a convenient, cost-effective and competitive inter-island vessel in the country. .
Finance Secretary and FIRB Chairman Carlos Dominguez 3rd revealed in a Viber message on Tuesday that the transport vessel is managed by Trans Asia Shipping Lines, which is publicly known to be controlled by Uy.
Dominguez was quoted in the statement as saying that the transportation player tax incentive authorization “aligns with the national government’s goal of modernizing transportation and increasing competition in the shipping industry. in the Phillippines”.
The project “will continue to generate revenue for the government even after the incentive period, which is a substantial economic benefit that the FIRB considers in granting tax incentive applications,” the Commerce Secretary also said and FIRB co-chair, Ramon Lopez.
Lopez also mentioned that there are few shipping lines operating the Cebu-CDO-Cebu route; thus, the arrival of a new player will contribute to strengthening the competitiveness of river transport in the region, by emphasizing the safety, well-being and comfort of passengers.
Ceferino Rodolfo, Undersecretary for Commerce and Managing Director of the Board of Investments (BOI), also said the potential benefits of the project should outweigh the cost of providing incentives, which are mainly driven by the increase in revenue from activity and substantial domestic expenditure in direct materials.
The project is likely to boost the flow of goods and services between Cebu and Cagayan de Oro by improving access to maritime transport, he said.
The DoF said the new transport vessel aims to strengthen industrial ties and agricultural trade between the central Visayas and northern Mindanao, in addition to increasing the productivity and efficiency of transporting goods and services.