SPEAKER Ferdinand Martin G. Romualdez has commended President Ferdinand “Bongbong” R. Marcos Jr. for signing into law a bill amending 25 sections and adding four new provisions in the National Internal Revenue Code.

The new law amends the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act. Its short title is CREATE MORE (Maximize Opportunities for Reinvigorating the Economy) Law.

Romualdez, one of the principal authors of the new law, said the CREATE MORE Act seeks to resolve confusion and ambiguities that have arisen on tax incentives the CREATE law had granted to local and domestic corporations since its enactment in March 2021.

Among the principal feature of the original law was the reduction of corporate income tax from 25 percent to 20 percent in line with global trends.

However, even if the law is just three years old, there have been complaints from a number of investors on the alleged ambiguity of some provisions, particularly those on value-added-tax incentives, he said.

“To resolve these issues, and to encourage these investors to remain in the country and keep their workers employed, we found it necessary to already amend the law,” he added.

The leader of the 300-plus-strong House of Representatives stressed that the changes also aim to attract more foreign investors.

“We acted fast to make adjustments in the law to preserve existing investments and to attract additional capital,” Romualdez said.

He pointed out that the CREATE MORE Law incorporates inputs gathered during the recent investment missions of President Marcos Jr. abroad “by adding tax income deductions and streamlining VAT-related procedures.”

He noted that the President’s foreign trips were expected to generate more than P1 trillion worth of investments.

The House leader said the changes introduced in the CREATE law do not reverse gains from the reduction of corporate income tax and the grant of other tax incentives.

One complaint raised by investors was about certain discrepancies in the original law and its implementing rules and regulations (IRRs).

He said VAT incentives meant for registered business enterprises, including economic zone locators, exporters, and local businesses classified as “preferred industries,” were granted in the IRRs only to registered export enterprises.

The CREATE MORE Act clears up confusion on this provision and resolves similar other issues in the implementation of the original legislation, he added.

AUTHOR PROFILE

Jester P. Manalastas