MANILA - Distressed exporters will be prioritized when the government starts testing a scheme that will allow companies to use tax credit certificates (TCCs) issued by one state agency to pay another, the Finance department said.

The European Chamber of Commerce of the Philippines (ECCP), one of the proponents of TCC "cross-utilization," confirmed this and has begun drafting a list of member firms that are in dire need.

"[Collecting agencies] have to consider, among others, the following before we can allow the full implementation of TCC cross-utilization: the cash situation of our economy, target performance of our agencies, full interconnectivity [among agencies], and administrative rules," One Stop Shop Center Executive Director Villamor Ventura S. Plan said in a text message over the weekend.

"[But] what we have initially agreed is that we have to consider application of cross-utilization to a case-to-case basis with the more distressed export companies," Mr. Plan said, without specifying when the process will begin.

The European chamber echoed this in their newsletter for June, saying: "It was suggested to start the process on a limited phase-in basis by selecting ’suffering’ companies that have a substantial backlog in unconverted TCCs. These companies are to be assisted first, testing the new cross-utilization."

The government issues an average of P5-8 billion worth of TCCs every year. Under the proposed scheme, cash-strapped companies grappling with the financial crisis can cope by paying taxes using TCCs instead of cash.

The ECCP has begun calling on member firms "holding a fair amount of TCCs" to come forward so the group can forward their names to the government.

It was not immediately clear if only ECCP member firms will be considered for the testing process. The group’s executive vice-president, Henry J. Schumacher, was not immediately available for comment.

On its Web site, the chamber said its leaders and two "affected companies" had met with Mr. Plan’s team to test the scheme.

Officials of the Bureau of Customs and the Bureau of Internal Revenue have both said they were open to the proposal, but were worried about its impact on collection targets.