Senate President Chiz Escudero sees the entry or more investments into the country and the retention of existing investors with the passage of the amendments to Republic Act 11534 or the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act.
A priority measure of President Ferdinand Marcos Jr., the bill dubbed CREATE to Maximize Opportunities for Reinvigorating the Economy (MORE) addresses the various concerns raised by investors about the implementation of CREATE.
“Senate Bill No. 2762 or CREATE MORE will simplify and streamline the value added tax provisions of RA 11534, particularly on the processing of VAT refund claims and the VAT zero-rating on local purchases. Discrepancies on the rules for these incentives has led to frustration among existing investors and discourages new investors from looking our way as a potential destination,” Escudero said.
On top of this, the veteran legislator noted that the inconsistencies in the application of the rules also have a detrimental effect on local suppliers, who could lose a huge chunk of their market as a result.
Since CREATE was enacted in 2021 until December 2023, over 100,000 new jobs have been created while total approved investments have reached P1.1 trillion.
Since CREATE was enacted in 2021 until December 2023, over 100,000 new jobs have been created while total approved investments have reached P1.1 trillion.
CREATE lowered the regular corporate income tax rate from 30 percent to 20 percent for domestic enterprises with a taxable income of P5 million and below, and total assets not exceeding P100 million. Business enterprises with assets surpassing P100 million were imposed the rate of 25 percent.
CREATE MORE will also introduce additional deductions in power expenses of Registered Business Enterprises, something which Escudero said would make the Philippines more competitive in light of the fact that the country has among the highest electricity rates globally.
The IT-BPM industry also stands to benefit from CREATE MORE by allowing flexible working arrangements based on certain parameters.
“This will make them more competitive in hiring and retaining personnel, many of whom have embraced work-from-home or remote working arrangements.”
“This will make them more competitive in hiring and retaining personnel, many of who have embraced work-from-home or remote working arrangements since the COVID-19 pandemic in 2019,” the seasoned lawmaker said.
The Senate President congratulated Committee on Ways and Means Chairman Senator Sherwin Gatchalian for ably steering the bill to passage in the Senate.
SBN 2762 is the consolidation of SBN 2564 authored by Gatchalian, SBN 2684 of Senator Juan Miguel Zubiri, House Bill No. 9794, and Senate Resolution Nos. 219, 244, and 567 filed by Senators Risa Hontiveros, Minority Leader Koko Pimentel III, and Gatchalian respectively.
