NEDA chief backs full on-site work for BPO firms

Socioeconomic Planning Secretary and National Economic and Development Authority (NEDA) chief Karl Kendrick Chua is in favor of the return to office of all IT-business process outsourcing (IT-BPO) firms as this will boost economic recovery.

“In the case of BPOs, we are very much appreciative of their contribution to the economy,” Chua said at a virtual press briefing on Tuesday.

“Part of going back to our new normal is really to continue our pursuit of working where the activities should be. In the case of BPOs, while I understand their concern, the rest of the economy has already shifted to working back in the office,” he added.

The Fiscal Incentives Review Board (FIRB) denied requests to extend remote-work arrangements beyond March 31, 2022.

The FIRB, during its February 21 meeting, upheld its Resolution No, 19-21, which allows firms in economic zones to implement work-from-home (WFH) arrangements for 90% of their workforce only until March 31, 2022.

This means that IT-BPO firms’ WFH arrangements will cease by the end of the month and all workers should return for on-site duty beginning April 1, 2022.

“I also understand that the legal basis for providing incentives to BPOs is that they should be situated in an economic zone. I am not certain if the homes of workers are economic zones. So I think we will have to look at this from this perspective,” Chua said.

Firms located in economic zones that fail to comply with the FIRB's rules cannot enjoy fiscal incentives such as income tax holidays and 5% tax on gross income earned.

“The BPO sector performed very well and was very productive before the pandemic, during the pandemic and I’m sure there is a big scope for them to also perform and contribute in this new normal where we are all back in the office,” Chua said.

The Philippine Economic Zone Authority (PEZA) said it will still file an appeal for reconsideration on the denial by the FIRB. —LDF, GMA News