BSP to promote BARMM as investment hub for Islamic banking

COTABATO CITY – The Bangko Sentral ng Pilipinas (BSP) has vowed to help promote the region as an investment destination for Islamic banking and finance, the Bangsamoro Regional Board of Investments (RBOI) chairperson said Friday.

Lawyer Ishak Mastura, RBOI chief, said the regional investment board’s initiative to provide fiscal and non-fiscal incentives for investors has received a positive response from the BSP.

The foregoing initiatives of the BARMM are laudable and can greatly assist in the development of Islamic banking in the Philippines. These initiatives are timely as they complement Revenue Regulation No. 17-2020 issued by the Bureau of Internal Revenue (BIR) on 7 August 2020,” the BSP letter said, according to Mastura.

Mastura said RBOI’s incentive scheme is provided under Republic Act No. 11439 entitled “An Act Providing for the Regulation and Organization of Islamic Banks.”

“The said Revenue Regulation, which implements the Tax Neutrality provision under R.A. No. 11439, essentially provides that Islamic banking transactions are taxed no more heavily (and no more lightly) than conventional banking transactions,” BSP added.

BSP said the issuance of the key regulatory frameworks, coupled with the BARMM incentive for Islamic banks, has made the Philippines a more attractive venue for Islamic banking.

“Rest assured that we will include the foregoing BARMM’s incentives for Islamic banks in our conversations with potential investors relative to Islamic banking,” the BSP letter said.

Mastura said the natural clientele and base of Islamic banking and finance operations in the Philippines is the BARMM considering that it is the only Muslim-majority region in the country with about four million population.

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