MANILA — The House of Representatives is poised to pass the proposed amendments to the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act, with the goal of transmitting the approved bill to the Senate by the end of November, as revealed by a key House member on Tuesday.
According to Philippines News Agency, Joey Salceda, during a recent hearing, the amendments proposed in the CREATE MORE bill are designed to refine the tax incentives system, with the intention of enhancing its competitiveness in the global market. The bill, as Salceda indicated, follows President Ferdinand R. Marcos' instructions to address the concerns of investors regarding the current law's provisions and its enactment.
The Committee has resolved to advance the bill by next week, though a brief pause was taken at the request of the Office of the President for additional time to finalize its position on the matter.
Salceda elaborated on the content of the House version of the bill, which aims to rectify issues surrounding the value-added tax (VAT) rate and the refund process, with particular attention to the needs of exporters. The bill's refinements include cutting the corporate income tax to 20 percent for those within the enhanced deduction scheme and introducing deductions for certain business expenses, such as a 200 percent deduction for power costs and trade-related expenditures.
The proposed legislation would also implement a consistent 1.5 percent registered business enterprise local tax (RBELT) across investment promotion agencies, effectively simplifying tax obligations by limiting interactions with local government entities. Furthermore, it would establish a special skills visa for highly skilled individuals working in registered business enterprises.
Salceda highlighted a notable provision that would enable the Information Technology Business Process Outsourcing sector to adopt full work-from-home arrangements, a move that acknowledges the shift towards hybrid work environments and the importance of maintaining competitiveness in the global arena.
Additionally, the committee endorses the presidential directive to diminish the role of the Fiscal Incentives Review Board in approving fiscal incentives, transferring more authority back to the Investment Promotion Agencies.
The House is also considering the elimination of a provision that would grant the President the power to offer tax incentives autonomously, in order to uphold a tax incentives system based on performance and standards. There is also an initiative to bolster the Fiscal Incentives Review Board's role in proposing measures to prevent the misuse of fiscal incentives in activities such as smuggling and tax evasion.