By The Manila TImes
September 19, 2023
TAX perks will be made available to the winning bidder of the P170.6-billion deal to rehabilitate, optimize and maintain the Ninoy Aquino International Airport (NAIA).
Key incentives under the Corporate Recovery and Tax Incentives for Enterprises law, including an income tax holiday for four years of operations and five years of enhanced deductions thereafter, are among the perks identified in a project information memorandum.
The winning bidder will also be exempt from customs duties on capital equipment, raw materials, spare parts and accessories made by registered business enterprises.
The project will also be eligible for non-tax incentives such as unrestricted use of consigned equipment, the employment of foreign nationals in supervisory, technical or advisory positions for a period of not more than five years from its registration, extendible for limited periods, and access to bonded manufacturing/trading systems.
The winning bidder will be required to pay an upfront payment of P30 billion to the government and a fixed annuity payment of P2 billion to be paid annually.
The government will also have a share of gross revenue, excluding passenger service charge (PSC) profits, based on the percentage share bid offered.
At least five potential bidders have already expressed interest in the NAIA project. The groups are San Miguel Corp., India’s GMR Group, the Manila International Airport Consortium, Spark 888 Management Inc., and the Asian Airport Consortium.
A pre-bid conference will be held this Friday, September 22, while the bid submissions are scheduled on Dec. 27, 2023. A contract is expected to be awarded by the end of the year.
The Department of Transportation and the Manila International Airport Authority are the co-grantors of the project, which involves a 15-year concession and an option for a 10-year extension.
The NAIA project entails, among others, improvements to the airport’s facilities in order to comply with International Civil Aviation Organization and other internationally accepted standards.
This means modernizing the terminals, optimizing and enhancing the airport’s capacity to 62 million passengers per year, enhancing asset quality and the passenger experience, improving information and technology systems, and ensuring reliable operations.
The winning bidder will be responsible for both landside and airside operations. It will be required to enhance the compliance, safety and security of the airport, and optimize and boost airport capacity in accordance with parameters to be detailed in the final concession agreement.