peza

BPO firms registered with PEZA can avail of incentives such as an Income Tax Holiday (ITH) for 4 to 6 years depending on location, and a Special Corporate Income Tax (SCIT) of 5% on gross income earned for up to 10 years, in lieu of all national and local taxes. These are governed by laws like the CREATE Act and the Special Economic Zone Act.

PEZA has permitted a hybrid work setup for its registered BPOs and RBEs, allowing up to 30% of the workforce to work from home, provided at least 70% work on-site. The agency issued Letters of Authority for this 70-30 arrangement, which was initially valid until September 12, 2022, and later extended until December 31, 2022, under certain resolutions. Firms wishing to implement 100% WFH must transfer registration to the Board of Investments (BOI) and forfeit PEZA incentives.

The FIRB, which includes the Department of Finance, has maintained that the law requires RBEs to operate within ecozones to enjoy fiscal incentives, viewing WFH as a temporary measure. They have pushed for a full return to office to reopen the economy. PEZA, advocating for the hybrid model's benefits for competitiveness and talent retention, has sought to institutionalize it, leading to policy disagreements on the interpretation of laws like the CREATE Act.