A HOUSE OF REPRESENTATIVES committee approved on Monday the tax incentive package contained in a bill seeking to regulate the low-carbon economy.
The House ways and means committee approved the tax incentives section of the bill, to be granted to companies developing “innovative technologies” that reduce greenhouse gas emissions.
“Investments in emerging low-carbon technologies by Covered Enterprises shall be eligible for income tax holidays and enhanced deductions on research and development expense… in accordance with CREATE More Act,” according to the amended version of the unnumbered substitute bill’s Section 35.
Covered enterprises are “large enterprises and medium-sized enterprises whose emissions exceed a specific threshold set by the Climate Change Commission,” according to a copy of the bill obtained by BusinessWorld. Power generation, transport, industrial processing, agriculture, and waste management industries fall under this category.
The House climate change committee approved the unnumbered substitute bill in August.
The Philippines aims to reduce greenhouse gas emissions by 75% in 2030, in line with commitments made under the 2021 Paris Agreement.
The country loses 3% of its economic output annually due to climate change, reinsurance company Swiss Re Group has said.
Companies covered under the proposed law are required to prepare their decarbonization plan, complete with “specific, measurable, and time-bound carbon reduction pathway… towards 2050,” according to the bill.
The decarbonization plan should include projected greenhouse gas emissions and a “comprehensive strategy” for reducing emissions, according to the bill.
Companies should also include emission reduction strategies within and beyond their value chain, including improvements to their production processes and transitioning towards renewable energy sources for their power needs.
They could also invest in technologies that support decarbonization efforts or by purchasing carbon credits from projects that offset greenhouse gas emissions, according to the bill. — Kenneth Christiane L. Basilio
