What the CREATE MORE Act Philippines Means for Foreign Investors in the Philippines

March 27, 2025

As the Philippines positions itself as a prime destination for foreign investment, a new legislative framework is reshaping the landscape. The CREATE MORE Act Philippines, signed into law in late 2024, builds on the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act to offer enhanced incentives and streamlined processes. Its Implementing Rules and Regulations (IRR), released in early 2025, clarify how these changes apply, particularly for foreign investors eyeing the country’s vibrant market. As of March 19, 2025, these rules signal a bold step toward economic modernization, balancing tax relief with regulatory clarity. This article delves into the IRR’s implications, offering foreign investors a roadmap to navigate opportunities and challenges in the Philippines. From tax breaks to compliance requirements, here’s what you need to know.

Understanding the Basics of the CREATE MORE Act Philippines IRR

The CREATE MORE Act Philippines introduces a refined incentive regime, and its IRR provides the operational blueprint. For foreign investors, grasping these fundamentals is essential to leveraging the law’s benefits. This section outlines the key elements of the IRR and its scope.

What is CREATE MORE Act Philippines: An evolution of the 2021 CREATE Act, it aims to attract investment by lowering taxes and simplifying business rules, with the IRR detailing execution.
Timeline of Effect: Signed in November 2024, the IRR took effect in February 2025, aligning with the CREATE MORE Act Philippines 2025 rollout for full implementation.
Focus on Foreign Investors: The IRR targets export-oriented firms and strategic industries, offering tailored Philippines business incentives to multinational corporations.
Authority Oversight: The Fiscal Incentives Review Board (FIRB) and Investment Promotion Agencies (IPAs) enforce the IRR, ensuring compliance and eligibility.
Legal Clarity: The IRR addresses ambiguities in the original law, such as incentive duration and application processes, providing a stable framework for investors.

The IRR’s transparency is a welcome shift for foreigners unfamiliar with local policies, aligning the Philippines with global investment standards.

Tax Incentives and Benefits Under the CREATE MORE Act Philippines

The allure of the CREATE MORE Act lies in its generous tax provisions, refined by the IRR to appeal to foreign capital. These incentives can significantly reduce operational costs, making the Philippines a competitive hub. Here’s how they benefit investors.

Reduced Corporate Tax: The IRR locks in a 20% income tax rate for qualifying firms, down from 25%, a key benefit of the CREATE MORE Act for profitability.
Extended Tax Holidays: Foreign investors in priority sectors enjoy income tax holidays (ITH) of 4 to 7 years, followed by 10 years of special rates, per CREATE MORE Act details.
Duty-Free Imports: Capital equipment and raw materials enter tax-free, a boon for manufacturing and tech firms under the Philippines’ investment laws.
Enhanced Deductions: Expenses for power, labor, and digital upgrades qualify for 50% additional deductions, encouraging modernization.
Grandfathering Provisions: Firms under the old CREATE Act retain existing incentives, and the transition to CREATE MORE benefits outlined in the IRR is smooth.

These perks position the Philippines as a cost-effective base, though eligibility hinges on strict compliance with IRR guidelines.

How the CREATE MORE Act Philippines IRR Works for Foreign Firms

The IRR doesn’t just promise incentives—it spells out how foreign investors can access them. Understanding its mechanics is critical for firms planning market entry or expansion. This section explains the operational framework.

How Does CREATE MORE Act Work: Foreign firms register with IPAs like the Philippine Economic Zone Authority (PEZA) to qualify for incentives, a process detailed in the IRR.
Application Process: Investors submit project proposals to IPAs, with approvals tied to economic impact and job creation, per CREATE MORE Act implementation rules.
Industry Prioritization: The IRR favors sectors like renewable energy, tech, and agribusiness, aligning with the Strategic Investment Priority Plan (SIPP).
Monitoring Mechanisms: Annual performance reports ensure firms meet targets, with the IRR empowering IPAs to revoke incentives for non-compliance.
Local Partnership Options: Joint ventures with Filipino entities streamline approvals, though wholly foreign-owned firms remain eligible in key sectors.

The IRR’s structured approach offers predictability, a critical factor for investors navigating Philippines business incentives.

Comparing CREATE MORE Act Philippines vs. CREATE Act

The CREATE MORE Act builds on its predecessor, but the IRR highlights distinct upgrades for foreign investors. Comparing the two reveals how the new law enhances appeal. This section contrasts their features.

Tax Rate Evolution: CREATE reduced taxes from 30% to 25%; CREATE MORE Act vs CREATE Act shows a further drop to 20% for new registrants.
Incentive Duration: CREATE offers shorter ITH periods (up to 5 years); CREATE MORE extends them to 7 years, per IRR adjustments.
Digital Focus: Unlike CREATE, CREATE MORE incentivizes tech adoption with deductions, reflecting CREATE MORE Act Philippines 2025 priorities.
Administrative Ease: The IRR cuts red tape, reducing processing times from 60 to 30 days and addressing CREATE’s bureaucratic critiques.
Scope Expansion: CREATE MORE includes more sectors (e.g., green tech), broadening opportunities beyond CREATE’s narrower focus.

For foreign investors, CREATE MORE offers a more robust, flexible package, though transitioning from CREATE requires strategic planning.

Steps for Foreign Investors to Leverage the CREATE MORE Act Philippines IRR

Capitalizing on the CREATE MORE Act requires proactive steps, especially given the IRR’s detailed requirements. Foreign firms must align operations with its provisions to unlock benefits. Here’s a practical guide.

Research Eligible Sectors: Review the SIPP to confirm your industry qualifies for incentives, a foundational CREATE MORE Act details step.
Engage an IPA: Partner with PEZA or another IPA to file your application, ensuring IRR timelines and criteria compliance.
Prepare Documentation: Submit feasibility studies and financial projections, as CREATE MORE Act implementation rules are mandated.
Invest in Compliance: Upgrade tax reporting and performance tracking systems, aligning with IRR standards for transparency.
Seek Expert Support: The process is complex. Triple i Consulting offers critical expertise to help you navigate the IRR’s intricacies.

Given the overlapping regulations and technical demands, Triple i Consulting’s assistance is invaluable. Their knowledge ensures foreign investors avoid costly missteps.

Future Implications of the CREATE MORE Act Philippines for Foreign Investment

The CREATE MORE Act and its IRR are more than policy updates—they signal the Philippines’ long-term economic ambitions. For foreign investors, the implications extend beyond immediate gains. This section explores the broader outlook.

Economic Growth Driver: According to government forecasts, the IRR’s incentives could boost FDI by 12% by 2027, enhancing the CREATE MORE Act’s impact on businesses.
Regional Competitiveness: Lower taxes and streamlined rules position the Philippines ahead of ASEAN peers like Vietnam, per investment laws Philippines trends.
Sustainability Push: Incentives for green industries align with global ESG demands, attracting eco-conscious investors by 2026.
Job Creation Impact: The IRR ties incentives to employment, potentially adding 500,000 jobs by 2030 and benefiting local and foreign firms.
Policy Stability: Clear IRR guidelines reduce investment risks, fostering confidence in the CREATE MORE Act Philippines 2025 framework.

The law sets a foundation for sustained growth, making the Philippines a strategic hub for forward-thinking investors.

Wrapping Up

Through its detailed IRR, the CREATE MORE Act Philippines offers foreign investors a compelling case to deepen their stakes in the country. With lower taxes, extended holidays, and a focus on digital and green industries, the law aligns immediate financial benefits with long-term economic goals. Yet, its complexity—spanning eligibility, compliance, and sector-specific rules—demands careful navigation. As of March 19, 2025, the IRR’s rollout marks a pivotal moment for multinationals seeking growth in Southeast Asia. Foreign firms can secure a competitive edge in a dynamic market by understanding and acting on these provisions.

Is assistance available?

Yes, Triple i Consulting provides expert guidance to simplify this intricate process. Their tailored solutions ensure you can confidently maximize the CREATE MORE Act’s potential. Contact us today to schedule an initial consultation with one of our experts: