The Philippines' new corporate tax regime has attracted $16.7 billion worth of investments, the Department of Finance (DOF) said.
The investments include 45 big-ticket projects and 740 projects with investment capital of P1 billion pesos or less.
The CREATE law, signed by former President Rodrigo R. Duterte on March 26, 2021, came into effect on April 11 of the same year. It introduced a rationalized fiscal incentives system with enhanced, performance-based, time-bound, targeted, and transparent incentives.
The 45 big-ticket projects have a total committed investment capital of $13.4 billion.
The 740 projects have a total investment capital of $3.3 billion.
CREATE sparks $17 B in investments—DOF
Sep 13, 2023 05:12 AM
At a glance
The Department of Finance (DOF) has reported that the government’s recent changes to its corporate tax system have attracted $16.7 billion in investments.
At the Philippine Economic Briefing in Dubai, Finance Secretary Benjamin E. Diokno said these investments include 45 major projects and 740 initiatives with investment capital of less than P1 billion.
Former president Rodrigo R. Duterte signed the the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Law on March 26, 2021, and it officially took effect on April 11 of the same year.
“A critical feature of this reform is the rationalization of the fiscal incentives system,” Diokno said.
“It has introduced an enhanced, single menu of fiscal and non-fiscal incentives that is performance-based, time-bound, targeted, and transparent,” he added.
The 45 big-ticket projects have garnered a total investment of $13.4 billion, whereas the 740 smaller projects amount to $3.3 billion in capital.
Registered companies and projects under CREATE are eligible for incentives such as income tax holidays, special corporate income tax rates, enhanced deductions, duty exemptions on selected material imports, and value-added tax (VAT) zero-rating on local purchases.
The Strategic Investment Priority Plan has also outlined the eligible activities for tax incentives under the CREATE Act.
“Investments in the countryside and in highly-advanced and technology-enabled projects and activities are given high priority and, consequently, higher and longer incentives,” Diokno said.
Likewise, incentives are given to projects covering research and development and those adopting advanced digital production technologies of the fourth industrial revolution, he added.
These include but not limited to, artificial intelligence, additive manufacturing, data analytics, cloud computing, nanotechnology, and investments in digital infrastructure, among others.
The CREATE Act also provides for a 40-year tax incentive package for highly desirable projects or activities with investment capital of about 900 million US dollars, or local job creation of at least 10,000.
This is subject to the approval of the President.