The Pearl of the Orient has significantly revamped its financial regime to lure foreign investors. With the implementation of the CREATE MORE Act, businesses can now avail of generous incentives that rival neighboring Southeast Asian markets.
Breaking Down the New Tax Structure
A primary feature of the current tax system is the lowering of the Corporate Income Tax (CIT) rate. Registered Business Enterprises (RBEs) utilizing the Enhanced Deduction incentive are now eligible to a preferential rate of 20%, down from the previous 25%.
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In addition, the length of fiscal availment has been lengthened. High-impact investments can nowadays benefit from fiscal holidays and incentives for up to twenty-seven years, offering long-term certainty for multinational entities.
Essential Incentives for Modern Corporations
According to the newest guidelines, businesses operating in the country can access several significant deductions:
100% Power Expense Deduction: Energy-intensive firms can today deduct double of their electricity costs, vastly reducing overhead costs.
Value Added Tax Benefits: The rules for 0% VAT on local procurement have been liberalized. Benefits now apply to items and services that are essential to the registered project.
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Duty-Free Importation: Registered firms can tax incentives for corporations philippines import machinery, raw materials, and accessories without imposing customs taxes.
Flexible Work Arrangements: Notably, RBEs operating in ecozones can now adopt work-from-home (WFH) setups without risking their fiscal incentives.
Easier Local Taxation
In order to boost the business climate, the government has introduced the Registered Business Enterprise Local tax incentives for corporations philippines Tax. Instead of dealing with various city taxes, qualified corporations can pay a consolidated tax of not more than two percent of their gross income. This reduces tax incentives for corporations philippines red tape and makes reporting far simpler for business entities.
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Why to Apply for These Incentives
For a company to qualify tax incentives for corporations philippines for these corporate tax breaks, businesses must enroll with an IPA, such as:
PEZA tax incentives for corporations philippines – Best for manufacturing businesses.
BOI – Perfect for local market leaders.
Specific Regional Agencies: Such as the Subic Bay Metropolitan Authority (SBMA) or Clark Development Corporation (CDC).
Ultimately, the tax incentives for corporations in the Philippines offer a competitive approach designed to drive expansion. Regardless of whether you are a tech startup or a large industrial conglomerate, understanding these laws is essential for optimizing your bottom line in 2026.