The Bureau of Internal Revenue (BIR) released the draft guidelines for the implementation of the newly-enacted Corporate Recovery and Tax Incentives for Enterprises (CREATE) Law, also known as the Republic Act No. 11534.
The CREATE Law will immediately cut corporate income tax from 30 per cent to 25 per cent, which will be retroactively applied starting July 2020. Corporate taxes will be slashed by a percentage point every year from 2023 to 2027 until it reaches 20 per cent.
The government expects P251 billion in foregone tax revenues in the first two years of the law’s implementation. The savings is then projected to attract more investors and provide more job opportunities in the next five years.