SIPP Focuses on Innovation-Driven Investments – Manila Bulletin
The Strategic Industries Priority Plan (SIPP), the new list of priority economic activities eligible for new tax incentive programs under the CREATE (Business Takeover and Tax Incentives for Businesses) law, will focus on innovation-driven investments.
Commerce and Industry Secretary Ramon M. Lopez told the Annual General Meeting of Members of the Semiconductor and Electronics Industries of the Philippines Inc. (SEIPI) that the SIPP would be designed to so as to encourage innovative strategic investments.
“In the SIPP, designed by our Board of Investments (BOI) under CREATE, we are streamlining our incentive system to be more innovation-driven,” Lopez said in a speech to investors in the industry. electronics and semiconductors.
Within the framework of the SIPP, he said: “We will focus on the development of industries with existing and future comparative advantage, as well as the integration of the production system, the deepening of participation in the value chain. global (CVM) and the adoption of Industry 4.0 and digital transformation. ”
The SIPP will also be a tool to push our industries to innovate and enter new emerging product markets.
For example, through the Electric Vehicle Incentive Strategy (EVIS), DTI is positioning the Philippines as a major production center for strategic electric vehicle parts such as automotive electronics, charging systems, battery energy storage systems using local minerals of nickel and cobalt, among others. other.
The SIPP is expected to be completed by January 2022 at the latest. It will replace the existing investment priority plan.
The economic activities listed in the SIPP will not only benefit from a reduction in corporation tax (IS), tax benefits of tax holidays and special IS, but also better tax deductions for training expenses and research and development, among others.
As businesses adjust to the “new normal,” Lopez cited the innovation of the electronics industry and the exemplary performance of the electronics industry in the midst of a crisis, it is capacity, resilience and agility that need to spill over into other industries, especially as the country rides the wave of digital transformation.
“This digital transformation will fundamentally change the way we live, work and do business. It is now transforming the way goods and services are produced through the application of advanced manufacturing techniques, such as artificial intelligence, robotics, data analysis, Internet of Things and 3D printing, to increase productivity. However, in addition to transforming the way goods and services are produced, it will also define, more importantly, what kind of goods and services will be produced in an increasingly digital and connected world, ”he said. he declares.
To capitalize on this transformation, Lopez urged companies to embrace Industry 4.0 technologies to boost productivity and penetrate high-value, high-growth global Internet of Things markets.
Electronic products have averaged 54 percent of the country’s total annual exports over the past ten years. In 2020, the sector further increased its share in the export basket to 62% or $ 39.67 billion, becoming the third largest contributor to our manufacturing GVA and accounting for 10.8% of total manufacturing GVA.
For the first quarter of 2021, the sector recorded a total of $ 10.7 billion in exports, up 8.8% from the same period last year.
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