What the CREATE MORE Act Actually Means for Your Business
Law: Republic Act No. 12066 (CREATE MORE Act) — Signed November 11, 2024
IRR: Signed February 17, 2025 — Published February 20, 2025
Keyword targets: CREATE MORE Act Philippines, BOI incentives, PEZA tax incentives 2025
What Is the CREATE MORE Act?
On November 11, 2024, President Ferdinand Marcos, Jr. signed Republic Act No. 12066 — the Corporate Recovery and Tax Incentives for Enterprises to Maximize Opportunities for Reinvigorating the Economy Act, or CREATE MORE. It is the most significant update to the Philippines' investment incentives framework since the original CREATE Act of 2021, and it directly affects every business that is — or is considering becoming — registered with the Board of Investments (BOI), the Philippine Economic Zone Authority (PEZA), or any other Investment Promotion Agency (IPA).
At RVTLC Law, we have reviewed the law and its Implementing Rules and Regulations (IRR) in detail. Here is what you actually need to know.
The Five Key Changes
1. Reduced Corporate Income Tax for Registered Enterprises. Under the Enhanced Deductions Regime (EDR), Registered Business Enterprises (RBEs) are now taxed at 20% of taxable income — down from 25%. This is a direct reduction in the tax burden for businesses engaged in registered export activities.
2. Expanded Additional Deductions. The additional deduction for power expenses has been increased from 50% to 100%. Businesses can also claim additional deductions for training, research and development, and labor costs, making the EDR significantly more attractive than it was under CREATE.
3. Longer Incentive Periods. Export enterprises under the Strategic Investment Priority Plan (SIPP) may now enjoy Income Tax Holiday (ITH) of 4 to 7 years, followed by either the Special Corporate Income Tax (SCIT) at 5% or the EDR for 10 years — or a combined SCIT/EDR period of up to 17 years for qualifying activities.
4. Work-From-Home Relief for IT-BPOs. IT-BPO companies registered with BOI may maintain 100% work-from-home arrangements and retain their tax incentives — a major relief for an industry that had been in compliance uncertainty since the pandemic.
5. VAT Zero-Rating Clarification. VAT zero-rating on local purchases now applies only to goods and services directly attributable to the registered project or activity of a registered export enterprise — a key limitation that businesses must account for in their procurement and invoicing practices.
What You Should Do Now
If you are already a BOI or PEZA-registered enterprise: review your existing incentive certificates against the new IRR. You may be entitled to transition provisions that extend your current incentives.
If you are planning to register: the 2025–2028 Strategic Investment Priority Plan (SIPP) determines which activities qualify for which incentive tiers. Review it before filing your application.
If you are an IT-BPO company: confirm your WFH percentage compliance with your IPA — the rules differ between BOI-registered and PEZA-registered entities.
If you are a foreign investor: CREATE MORE improves the Philippines' competitiveness significantly against Vietnam and Thailand, which both have 20% corporate income tax rates. This is the right time to conduct a Philippine market entry assessment.
Official Sources
→ CREATE MORE Act (RA 12066) — Fiscal Incentives Review Board (FIRB)
→ Philippine Economic Zone Authority (PEZA)
→ PEZA Issuances on CREATE MORE
RVTLC Practice Note: CREATE MORE is technically complex — the interaction between ITH periods, the EDR, and the SCIT requires careful planning for each registered project. RVTLC Law advises on BOI and PEZA registration, incentive structuring, and compliance. Contact us at admin@rvtlc-law.com.
