City of Mandaue
Mandaue Investment Promotions Action Center (MIPAC)
NEW INVESTMENT CODE IN THE CITY OF MANDAUE
City Preferred Activities List (CPAL)
New investments with a minimum capitalization and/or total assets in Mandaue of at least
Three Million (Php 3,000,000.00) Pesos, excluding investment in land, shall be eligible to a
local tax holiday, as defined by Section 4 of this ordinance for a period of one (l) year from
the time of the issuance of the certificate of registration by the Board, provided that the
nature of business of such new investment falls under the following City Preferred Activities
List, to wit:
a. Manufacture of Modular Mass Housing Components - This covers the
manufacture of modular housing components preferably using indigenous
materials. These include roof/framing systems, wall/partition systems, flooring
systems, door/window systems, and finishing/ceiling systems.
The Firm shall sell at least 50% of total annual production to mass housing
projects.
b. Creative Industries/knowledge-Based Services - This covers business/knowledge
processing. This also covers non-voice business processing operations, creative
and knowledge-based services such as but not limited to software development,
animation, engineering and architectural design, product design, game and
applications development and software development. Non-voice business
process operations include the undertaking of outsourced services such as
administrative and business services, transcription services, engineering and
architectural services. Creative/Knowledge-Based Services does not include
tarpaulin printing, billboard printing, and/or other types of printing on different
kinds of media
c. Passenger/Intermodal Terminals - This covers the development and operation of
passenger/intermodal terminals, including passenger terminals that will integrate
public utility vehicles operating within the City, with the following qualifications:
i. Must cater to shipping lines and/or different land transportation
systems (rail system, buses, taxis, etc.);
ii. Must have new facilities with parking, comfort rooms, ticketing and
reservation office, sufficient passenger waiting area and provide
shuttle services, whenever applicable; and
City of Mandaue
Mandaue Investment Promotions Action Center (MIPAC)
iii. Must have a system of ingress and egress to prevent traffic build
up/obstruction of thoroughfares on a 24-hour basis as certified by the
Traffic Enforcement Agency of Mandaue (TEAM) Board.
d. Charging Stations for Electric Vehicles - This covers the projects involving the
establishment of charging stations for electric vehicles. The charging stations
could refer to a 'service station' designed to simultaneously fast charge multiple
vehicles similar to gasoline/diesel stations or a network of at least 5 charging
stands, the application of which must be duly endorsed by the appropriate agency
of government whenever applicable.
e. Research & Development - This covers establishments solely devoted to research
and development such as research/testing laboratories (e. g. for pharmaceuticals,
electronics, construction, etc.) This also covers the establishment and operation
of facilities for the conduct of clinical trials (e.g. Clinical Research Organization or
CRO). The CRO must submit a copy of Permit for Clinical Investigational Use to the
City by the Food and Drugs Administration before the conduct of each clinical trial.
Applicants must submit the appropriate endorsement by any national agency of
government such as the DOST.
f. Center of Excellence (COE) - This covers the establishment of entrepreneurial,
technology, business incubation centers, common service facilities, and
manufacturing, service and agribusiness entities including those locating in the
premises of Commission on Higher Education accredited universities and colleges
and with special arrangement with the university and/or college to develop
competencies in entrepreneurship, and research and development.
g. Manufacture/Assembly of Alternative Fuel Vehicle (AFV) and Electric Vehicles
(EV) including the Manufacture of AFV and EV components - This covers projects
on the manufacture/assembly of alternative fuel vehicle and electric vehicles
(excluding 2-sfroke motorcycles), which include the following:
i. Hybrid vehicles or those vehicles that run on electric batteries and
gasoline/diesel/other fuels
ii. ii. Electric vehicles or those that run solely on electric power
iii. Flexible-fuel vehicles or those that run on gasoline/diesel in
combination with alternative fuel such as but not limited to:
1. Bioethanol vehicles that run on gasoline and a minimum ethanol
content/blend of at least 20%
City of Mandaue
Mandaue Investment Promotions Action Center (MIPAC)
2. Biodiesel vehicles that run on diesel and a minimum biodiesel
blend/content of at least 5%
3. Compressed Natural Gas Vehicles or vehicles that run on
Compressed Natural Gas (CNG);
4. Other vehicles powered by LPG, fuel cell and other alternative
fuels: and
5. Manufacture of AFV and EV components either as original
equipment manufacturer (OEM) or after - market products,
including the manufacture of electric motors, batteries other than
lead acid batteries, controller assembly and battery charger for
electric vehicles.
h. Clean Water Projects - This covers the establishment of wastewater treatment
facilities and sewage collection integrated with treatment facilities and the
adoption of water pollution control technology, cleaner production and waste
minimization undertaken through BOT or non-BOT schemes.
Activities such as 5S and Good Housekeeping are not qualified for registration
under the CPAL.
Wastewater treatment facilities and sewage collection integrated with treatment
facilities maybe entitled to ITH. Projects adopting water pollution control
technology, cleaner production and waste minimization are entitled to the local
tax holiday but only to the extent of their capital equipment.
Applications under this provision shall be endorsed by the DENR, DOST and other
pertinent agencies.
i. Renewable Energy - This covers the development of renewable energy facilities,
including hybrid systems.
This also covers manufacturers, fabricators and suppliers of locally produced
renewable energy (RE) equipment and components.
Sales of power generation projects with feed-in-tariffs (FIT) shall not be entitled
to local tax holiday.
Applications for registration under this provision must submit DOE Certifications
(Certificate of Registration, Accreditation and/or DOE Endorsement, whichever is
applicable).
City of Mandaue
Mandaue Investment Promotions Action Center (MIPAC)
j. Manufacture of Export Products - This covers the production/manufacture of
export products and with export requirement of at least 50% of its output, if
Filipino owned, or at least 70% if foreign-owned.
Export products include electronics, garments and textiles, footwear and leather
goods, furniture, jewelry, marine and aquaculture, mineral products and others.
k. Projects Directly Related to City Strategy - Projects that may fall within the
concept of strategic initiatives and which may substantially, positively and directly
affect the measures of the city strategy, and which strategy, initiatives and
measures me duly approved by the Performance Governance System Core Team
and the Sangguniang Panglungsod. This however, does not include contactors,
suppliers and/or consultants of the Government undertaking the various
components of the said and/or of the entire strategic initiative.
EXPENSE INVENTIVES
A. Expansion Incentive for Micro, Small, Medium and Large Enterprises Engaged in
Manufacturing - Micro, Small and Medium Enterprises engaged in Manufacturing that
undertake expansion as defined by this Code, shall be eligible to deduct from its gross
receipts the direct expansion cost, but which deduction shall not exceed thirty percent
(30%) of the gross receipts for the year the cost was incurred, subject to the following
conditions:
1. The expansion must result to any of the following:
a. Substantial reduction in production cost;
b. Significant increase in productive efficiency;
c. Upgrading of product quality; or
d. Keeping abreast with the state-of-the-art technology/ies in the
production of the enterprise's principal product line.
B. Expansion of Micro Businesses Engaged in Manufacturing that Previously Avail of
Amnesty - Micro businesses engaged in manufacturing that avail of the amnesty provided
in Section 13 shall not be allowed to claim for expansion incentives within the tax year of
the amnesty. However, they shall be eligible for expansion incentive the following tax
year subject to the conditions specified in Section 14.
C. Incentive for Installation of Quality Management Systems. - Micro, Small, Medium and
Large Enterprises engaged in Manufacturing that shall acquire and/or install quality
management standards such as but not limited to quality standard certifications such as
ISO certification series, good manufacturing practices, etc. shall be eligible to deduct from
City of Mandaue
Mandaue Investment Promotions Action Center (MIPAC)
their gross receipts the direct expenses therefor but which deduction shall not exceed
thirty percent (30%) of the gross receipts for the year the cost was incurred. Activities
such as 55 and Good Housekeeping are not qualified for incentives under this provision.
D. Incentive for New Product Development - Existing Micro, Small, Medium and Large
Enterprises engaged in Manufacturing that conduct new product development including
market or concept testing shall be eligible to deduct from their gross receipts the direct
expenses therefor but which deduction shall not exceed thirty percent (30%) of the gross
receipts for the year the cost was incurred, subject to the condition that the enterprise
received substantial purchases and/or orders of the new product within six (6) months
from the product launch.
E. Incentives for Business Linkages- Large and Medium Enterprises that create business
linkages with micro, small and medium manufacturing enterprises, shall be eligible to
deduct from their gross receipts the direct expenses that shall arise by reason of the
business linkage, but which deduction shall not exceed thirty percent (30%) of the gross
receipts for the year the cost was incurred, provided that: the micro, small and/or
medium manufacturing enterprise is enrolled in the business linkage program of the City,
provided further that: in no manner shall this provision be construed as allowing labor
only contracting as defined by the Labor Code and its implementing rules and regulations.
INCENTIVES FOR GREEN BUILDING
A. Incentives for Buildings that Avail of BERDE Certification. - Buildings that voluntarily
comply with BERDE Certification may register under this Code with the MIPB, for the
following discounts against the Real Property Tax on the building of the year the
Certification is issued, to wit:
1. 5oZ discount if a building is l-Star BERDE Certified;
2. 10% discount if a building is 2-Star BERDE Certified;
3. 15% discount if a building is 3-Star BERDE Certified;
4. 20% discount if a building is 4-Star BERDE Certified; and
5. 25% discount if a building is 5-Star BERDE Certified.
Provided that: The discount shall be deductible from the RPT liability of the building, not
the lot on which the building is constructed; Provided further that: The building owner
City of Mandaue
Mandaue Investment Promotions Action Center (MIPAC)
may apply for RPT discount on the building, within a period of three (3) years from the
time the BERDE Certification, whether the Certification is for design, construction or
operation, is issued; Provided finally that: In the event that there are two or more BERDE
Certifications issued within a tax year, the building owner may avail of the RPT discount
only once.
B. Incentives for Mandatorily Required Buildings - Buildings required by the Green Building
Ordinance to comply with the 3-Star BERDE Certification, may apply for registration under
this Code, for the payment of building and/or occupancy permit fees, as the case maybe,
in three (3) equal installments; Provided that: The first installment shall be payable upon
the time the fee is assessed and ought to be paid pursuant to law Provided further that:
the 2nd and 3rd installments shall be payable within a period of six (6) months from
payment of each, successively.
In the event that the building shall voluntarily avail of 4 and/or S-Star BERDE Certifications
beyond the minimum requirement, the building owner may register under this Code with
the MIPB, for the following discounts against the Real Property Tax on the building of the
year the Certification is issued:
1. 5% deduction if a building is 4-Star BERDE Certified;
2. l0% deduction if a building is 5-Star BERDE Certified;
Provided that: the grant of fiscal incentives under this provision shall be subject to the
same conditions as mandated under sub-paragraph (a) hereof.
NON-FISCAL INCENTIVES
I. A registered enterprise shall be entitled to the following non- fiscal incentives:
a. Assistance in securing local permits and licenses;
b. Assistance in identifying business location and factory sites;
c. Assistance in facilitating the construction of access roads towards intended site;
d. Joint ventures match-making;
e. Facilitating access to financial and technical assistance programs of the
government; and
f. Facilitating service connections with local utilities
II. Non-fiscal incentives for Green Building – In addition to the foregoing, a registered Green
Building shall be entitled to higher Floor to Area Ratio than that prescribed by the City
and recognition from the City for efforts in pursuing the Green Building Program.
