The Board of Investments (BoI) has urged registered business enterprises (RBEs) to transfer the listing of their businesses to the Corporate Recovery and Tax Incentives for Enterprises to Maximize Opportunities for Reinvigorating the Economy (CREATE MORE) Act to obtain higher tax incentives.

In a virtual press conference, BoI managing head, Trade Undersecretary Ceferino Rodolfo, disclosed that the deadline for submission of intent for the transfer registration of RBEs for pre-CREATE to CREATE, and from CREATE to CREATE MORE is only until 31 December with no extension as based on the implementing rules and regulation of the RA 12066.

“To date, there are 82 RBEs that have already signified their intent to transfer. A total of 275 RBEs are qualified to transfer (pre-CREATE to CREATE), while 12 projects are qualified to transfer (CREATE to CREATE MORE),” Rodolfo told reporters on Thursday.

“The submission of the letter of intent is imperative because it has a deadline based on the IRR. Although we are in touch with eligible companies, this is to remind them again that they have only until the end of this year to transfer,” Rodolfo added.

Based on the BoI advisory released last 18 December, companies eligible to transfer from CREATE to CREATE are RBEs with existing projects regardless of investment capital registered before the effectivity of the CREATE Act (pre-CREATE RBEs); and RBEs with existing projects with investment capital exceeding P15 billion registered during the effectivity of the CREATE Act (CREATE RBEs).

Affidavit needed

“The aforementioned pre-CREATE RBEs and CREATE RBEs may transfer their registration to RA 11534 and RA 12066, respectively, to avail of the incentives provided therein, subject to conditions that the RBE has either started operating or is in the pre-operating stage but has not availed of any income tax-based incentives under the terms and conditions of its registered project; the RBE meets the qualifications for registration as prescribed under Part III, Rule 6, Section 2 of the IRR of the CREATE Act; that the RBE is not an excluded service activity as defined under Part I, Rule 1, Section 4(W) of the IRR of the CREATE Act; and the RBE complies with the conditions and requirements set forth in the Strategic Investment Priority Plan,” according to the advisory.

Moreover, the BoI said covered BoI RBEs may submit an affidavit of intent using the prescribed format on or before 31 December 2024 and submit the transfer application.

Applications with an Affidavit of Intent filed beyond the said period shall not be considered.

Covered BoI RBEs may submit two (2) original copies of the Affidavit of Intent with the BoI-Legal and Compliance Service, or scanned copies via email at lcssubmission@boi.gov.ph, subject to submission of the original copies, the Advisory said.

Under the CREATE MORE Act, the maximum duration of tax incentives availment is extended by 10 years to 27 years from 17 years, to attract strategic and high-quality investments.

The RBEs under the enhanced deductions regime will benefit from a reduced corporate income tax rate of 20 percent.

The law, signed by President Ferdinand Marcos Jr. last November, also grants a 100-percent additional deduction on power expenses to cut the costs for the manufacturing sector.

It also further streamlines the value-added tax refund process by limiting the documentary requirements and addressing the VAT concerns raised by export-oriented enterprises.

RA 12066 also introduces various reforms such as the rationalization and streamlining of incentives-related processes to address investors’ pain points and cultivate an investment-friendly climate.