Metro Manila, Philippines— President Ferdinand Marcos Jr. has signed into law a bill that amended COVID-era tax cuts and incentive system for companies doing business in the Philippines.
The freshly minted law, the Corporate Recovery and Tax Incentives for Enterprises to Maximize Opportunities for Reinvigorating the Economy (CREATE MORE) Act, aims to position the Philippines as a leading investment hub by enhancing the country’s tax incentives framework to be globally competitive, investor-friendly, predictable, and accountable.Marcos highlighted the law’s role in helping businesses recover from the COVID-19 pandemic’s economic impact in a ceremony marking the signing of Republic Act 11534 on Monday, Nov. 11. The CREATE MORE Act lowers the corporate income tax rate from 25% to 20%, positioning the Philippines as a more attractive destination for foreign investors. It also rationalizes fiscal incentives to make the business environment more efficient and appealing.“CREATE MORE sets the stage for a business landscape that empowers our enterprises and enhances their growth prospects. By building on the reforms initiated through the CREATE Act, we have enhanced our tax regime and incentive framework, making it more inviting for investment—while remaining steadfast in the principles of fiscal prudence and stability,” Marcos said.The law also aims to provide clarity on the application of VAT zero-rating for local purchases and VAT exemptions for imported goods and services. These provisions apply to goods and services directly linked to registered projects or activities, covering essential services like janitorial, security, financial, consultancy, marketing, as well as administrative functions such as human resources, legal, and accounting services.To streamline tax compliance, the law introduces a 2% Registered Business Enterprise Local Tax (RBELT) based on gross income.
