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PH BPOs Worried about Proposal on Tax Breaks

by: Sarah Joson

Thursday, January 29, 2015 | Outsourcing News |

PH BPOs Worried over Removal of Tax Incentives

Call center companies in the Philippines are eagerly waiting for the official announcement on tax incentives. The Contact Center Association of the Philippines aired their sentiments regarding the possible removal of tax breaks from the perks given to the outsourcing industry, saying it would weaken the sector and affect its achievements.

In a press briefing at SMX Convention Center, CCAP President Benedict Hernandez said officials need to see it from their point of view, stating that the proposed adjustments could be detrimental to the growth of the industry and affect job production in the country.

The key issue revolves around the outsourcing companies registered at the Philippine Economic Zone Authority (PEZA) that are entitled to an income tax holiday of four to six years. This is on top of other incentives that these organizations are already getting.

CCAP pointed out that call centers prefer the income tax holiday for six years instead of the proposed reduction of the corporate income tax of 10 percent for 15 years.

Hernandez added that other countries are getting better incentives, and though the Philippines’ package is not the best, they don’t want to have it worse.

Everest Group, on the other hand, said the Philippines is still the top destination for voice processes, taking up 36 percent of the total market share of outsourced services globally.
Voice functions take the lion’s share with 90 percent, followed by non-voice processes such as email and chat support that are seen gaining traction as demand continues to increase.


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