The Fiscal Incentive Review Board (FIRB) issued Advisory No. 014-2023 dated August 31, 2023 to circularize the Department of Finance Department Order (DOF DO) No. 033-2023 clarifying the guidelines on the imposition of local taxes, fees and charges on transitioning RBEs, or those granted incentives prior to the effectivity of the Corporate Recovery and Tax incentives for Enterprise (CREATE) Act.
(FIRB Advisory 014-2023 dated 31 August 2023)
The following rules shall apply with respect to local taxes, fees, and other charges:
On local taxes:
- Transitioning RBEs availing of ITH only and classified as either pioneer or non-pioneer shall be exempt from local business taxes for the remaining period of the ITH. All other transitioning RBEs shall be subject to local taxes.
- Transitioning RBEs currently availing of ITH that are also entitled to the 5% tax on GIE after the ITH shall be exempt from local business taxes during the remaining period of the ITH. Thereafter, the RBE shall be exempt from all local taxes while availing the 5% GIE, subject to the 10-year limitation for both incentives.
- Transitioning RBEs availing of 5% GIE only shall be exempt from local taxes for 10 years from the effectivity of the CREATE Act.
On fees and charges.
Transitioning RBEs granted exemption from local fees and charges under their registration agreements with the concerned IPA, or by their respective LGUs, shall continuously be exempt from fees and charges for 10 years. Otherwise, LGUs may continue collecting such fees and charges if RBEs are liable thereto prior to the effectivity of CREATE.
You may download a copy of the FIRB Advisory bellow.