CCAP: PH no longer cheapest outsourcing destination

THE Contact Center Association of the Philippines (CCAP) is seeking to retain incentives under the government’s tax reform program to maintain the country’s stature as an attractive outsourcing business destination.

CCAP president Jojo Uligan yesterday said the country is already behind its competitors in terms of incentive offerings and that removing such perks under the second tax reform package could dampen the industry’s growth.

According to Uligan, the Philippines is no longer the cheapest outsourcing destination.

“We are already 10 percent higher than India,” he said, adding that incentives are the country’s best lures to bring in investments, on top of other assets like talent availability and skills.

“We need to maintain what we can maintain or meet halfway,” said Uligan. “If we have these incentives, we can compete.” He pointed out that the industry remains in constant dialogue with the government about the Train 2 package.

Uligan and CCAP officials were in Cebu to promote Contact Islands 2018 on July 25 to 26 in Shangri-La’s Mactan Resort and Spa Cebu.

Train 2 seeks to rationalize fiscal incentives and reduce corporate income tax rates gradually to no less than 25 percent from 30 percent. The economic team of the Duterte administration is proposing to modify tax incentives for companies to make these “performance-based, targeted, time-bound, and transparent.” The Finance Department maintains the proposed legislation is not meant to remove incentives but would rather make it more responsive, relevant and effective.

CCAP targets to grow between seven and nine percent this year. The industry employs around 800,000 workers.

Currently, the Philippines is the biggest source of contact center services and is expected to take 16 percent to 18 percent of the total outsourced services globally in 2018, based on data from The Everest Group, a Texas-based global consulting and research firm.

Source: Sunstar Cebu