SUBIC BAY FREEPORT — The extension of Subic Bay Freeport’s tax and duty-free privileges to the City of Olongapo will be a key component in realizing the P3-billion development project proposed by Ayala Land, Inc. (ALI) for the city’s business district.

ALI President and CEO Antonino Aquino said that fiscal incentives like Subic’s minimal five percent gross income tax, if successfully extended to the 7,000-square meter Olongapo City Central Business District (CBD) Triangle, would set the stage for robust trade in the area.

Aquino said these tax and duty-free incentives would enable the planned tripartite committee to offer attractive deals to win the cooperation of Olongapeños, particularly the business group, which he said would be the “lifeblood of this development.”

SBMA Administrator Armand Arreza assured Aquino that this prospect would be realized as soon as President Arroyo approves the implementing rules and regulations (IRR) of Executive Order No. 675, which was signed by the President on November 5, 2007 to expand the area where tax and duty-free privileges would apply.

“Once the President gives her approval, it is up to the City of Olongapo to decide what particular incentives to offer,” said Arreza.

Arreza and Aquino signed a memorandum of understanding with the Olongap City government last week for the proposed Olongapo CBD Triangle project.

Per agreement, ALI will commission the master plan for the project free of charge, granted that the city government would give ALI the option to develop or purchase, subject to applicable laws, Olongapo City’s properties inside the 7,000-square meter project area.