In a move to make the Philippines a prime investment destination, President Ferdinand “Bongbong” Marcos, Jr., recently signed into law the Corporate Recovery and Tax Incentives for Enterprises to Maximize Opportunities for Reinvigorating the Economy (CREATE MORE) Act, according to a Philippine News Agency (PNA) news article.
To put things in perspective, posted below is an excerpt from the PNA news article. Some parts in boldface…
President Ferdinand R. Marcos Jr. on Monday signed the Corporate Recovery and Tax Incentives for Enterprises to Maximize Opportunities for Reinvigorating the Economy (CREATE MORE) Act to promote the Philippines as a prime investment destination.
CREATE MORE Act or Republic Act (RA) 12066, signed by Marcos in a ceremony at Malacañan Palace in Manila, builds on the game-changing economic reforms introduced under the CREATE law by making the country’s tax incentives regime more globally competitive, investment-friendly, predictable and accountable.
Marcos said the signing of RA 12066 signifies his administration’s unwavering commitment to empowering the business sector and enhancing their growth prospects.
“We cannot emphasize enough the important role of the business sector in shaping this law. Your feedback has been essential in our efforts to craft policies that make our country truly competitive on the global stage,” Marcos said.
“As we open new doors of opportunity, we drive businesses to reinvest their capital, build upon the workforce, and initiate a ripple effect that will be felt across generations,” he added.
Marcos said the new law is a reflection of the government’s resolve to foster a climate where businesses will flourish and continue to meaningfully contribute to the Philippine economy.
“By establishing clear timelines and deadlines and by limiting compliance requirements to those mandated by law, we are promoting transparency and predictability. And in so doing, we create a more reliable process that instills confidence in investors and in partners alike,” he said.
“To our investors and development partners, let this be our pledge: The Bagong Pilipinas (New Philippines) continues to foster an economy where businesses and investments remain at the heart of our progressive development.”
Under the CREATE MORE Act, the maximum duration of tax incentives availment is extended by 10 years to 27 years from 17 years, to attract strategic and high-quality investments.
Registered business enterprises (RBEs) under the enhanced deductions regime will benefit from a reduced corporate income tax rate of 20 percent.
The new law also grants a 100-percent additional deduction on power expenses to cut the costs for the manufacturing sector.
It also further streamlines the value-added tax (VAT) refund process by limiting the documentary requirements and addressing the VAT concerns raised by export-oriented enterprises.
RA 12066 also introduces various reforms such as the rationalization and streamlining of incentives-related processes to address investors’ pain points and cultivate an investment-friendly climate.
It likewise simplifies local taxation by imposing a local tax on RBEs in lieu of all other local taxes, fees, and charges.
The CREATE MORE law also strengthens the respective mandates of the Fiscal Incentives Review Board (FIRB) and the investment promotion agencies (IPAs).
It institutionalizes the adoption of flexible work arrangements as a business model for RBEs operating inside economic zones and freeports, without disruption in the enjoyment of their tax incentives.
Marcos said the Filipino people would benefit from the passage of the CREATE MORE Act through more and better economic opportunities that uplift their lives, such as high-quality jobs.
The signing of CREATE MORE law is consistent with the Marcos administration’s 8-point socioeconomic agenda.
Lawmakers lauded President Marcos for signing the measure, saying it would stimulate economic growth by attracting foreign direct investments (FDIs).
“With more foreign direct investments that CREATE MORE is expected to generate, more Filipinos will have better employment opportunities that will, in turn, redound to stronger domestic consumption, one of the major drivers of the local economy,” Senator Sherwin Gatchalian said in a statement.
Let me end this post by asking you readers: What is your reaction to this recent development? Do you think the CREATE MORE law will succeed in attracting more foreign investments into the Philippines? Do you expect to see results related to the new law over the next eighteen months?
You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.
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