THE Fiscal Incentives Review Board (FIRB) has approved the application for tax incentives of Converge ICT Solutions, Inc. and three other telecommunication companies, following the recommendation of the Board of Investments.
The tax incentives granted to Converge include a four-year income tax holiday, five years of enhanced deductions, and 11 years of duty exemption on equipment and raw materials. These were granted to Converge for its fiber optic network for high-speed internet broadband, with a total project cost of P150.6 billion.
“We expect Converge to deliver on its performance commitment of faster and cheaper internet access in remote localities as this will not only address our pain points with regard to connectivity but also provide more employment opportunities to our people in rural areas,” Finance Secretary and FIRB Chairman Carlos G. Dominguez III said in a statement issued by the Department of Finance (DoF).
The other three telcos granted the same tax incentives were SkyTowers Infra, Inc., Frontier Tower Associates Philippines, Inc., and Transcend Towers Infrastructure Philippines, Inc.
However, the incentives were conditional on building telecommunications towers in areas that lacked service.
The other three telcos’ projects cost a combined P78.2 billion.
Converge’s connectivity facility projects for broadband are the largest of 11 big-ticket incentive applications approved by the FIRB this year, the DoF said in a separate statement issued on Monday.
“The approval of these projects is urgent, given the current gap in the number of towers needed to service our population,” FIRB Secretariat Head and Finance Assistant Secretary Juvy C. Danofrata said. “We are optimistic that these approved applications will pave the way for our country to finally have improved connectivity and more quality service.”
At a joint Asian Development Bank and an ASEAN+3 Macroeconomics Research Office webinar last May 13, participants heard that internet speeds in the Philippines were among the slowest in the Association of Southeast Asian Nations (ASEAN), at 49.5 mbps, nearly a 10th of the speeds realized in Singapore. — Tobias Jared Tomas