MANILA - The House Committee on Ways and Means said Wednesday it has approved a profit sharing agreement with San Miguel Corp on the construction and operation of the new international airport in Bulacan.

The new airport is expected to generate revenue of "anything beyond the 12 percent rate of return" subject to 50-50 sharing, House Ways and Means Committee chair and Albay Rep. Joey Salceda said in a statement.

Under the profit sharing agreement, SMC's subsidiary which will operate the airport will share half of its profits to the government and all profits above 14 percent, he said.

The House Committee on Legislative Franchises earlier approved the substitute bill which was tackled by the Ways and Means Committee to discuss "tax implications."

The New Manila International Airport, expected to decongest the main gateway in the capital, will be built in Bulakan, Bulacan, some 30 kilometers north of Metro Manila.

The P740-billion infrastructure project will come entirely out of private sector's hands, in return, the committee is being asked for tax exemptions, he said.

The panel made the tax provisions "fairer" to maximize gains or returns from the project, he added.

“The final report that came out of the tax committee, and following our own conversations with the House leadership, is significantly more tempered than the original," Salceda said.

Salceda said all other income generated outside airport operations such as hotels, and restaurants near the vicinity should be taxed.

San Miguel Corp formally accepted the Notice of Award from the Department of Transportation for the Bulacan airport project in August 2019.

The proposed airport will have 4 runways, expandable up to 6, with a capacity of 100 million passengers every year, San Miguel earlier said.

• LOOK: New Manila International Airport in Bulacan proposed design released