MANILA - ABS-CBN subsidiary Big Dipper pays correct taxes and is legally allowed to enjoy tax incentives, officials from the Bureau of Internal Revenue (BIR) and the Philippine Economic Zone Authority (PEZA) said on Wednesday.

Quezon City Revenue Region 4-A Director Alvin Galanza said that from 2016 to 2019, Big Dipper paid P1.15 billion in taxes to the BIR, representing 3 percent of its gross income earned.

“I think they are paying more or less correctly their taxes,” said Galanza during a congressional hearing on ABS-CBN’s application for franchise renewal.

Big Dipper is a digital content and design company that processes films and TV shows for distribution to other countries and various digital platforms. It is registered with PEZA, which provides financial incentives for technology and export-oriented firms.

Opponents of ABS-CBN’s franchise renewal have alleged that Big Dipper has been using its registration with PEZA as a tax shield.

But PEZA Director General said all of the tax incentives enjoyed by Big Dipper were allowed under the law.

“Itong lahat po ng incentives na binibigay namin ay based on the law, the PEZA Law,” Plaza told lawmakers.

She added that applications with the investment-promotions agency are scrutinized by members of the PEZA Board, which includes officials from the finance, trade, science and other departments.

“There’s no such thing as making PEZA the tax shield because all these incentives are being evaluated by all these agencies of government,” she added.

Plaza said Big Dipper’s brought in $27.7 million in export revenues in 2016, and is considered a technology pioneer by PEZA.

Big Dipper is also fully compliant with PEZA regulations, she said.

ABS-CBN has said that Big Dipper has generated over $237 million in foreign exchange inflows.

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