REVENUE MEMORANDUM CIRCULAR NO. 83-2021 issued on July 12, 2021 circularizes the Implementing Rules and Regulations (IRR) of Title XIII of Republic Act (RA) No. 8424, otherwise known as the “National Internal Revenue Code of 1997”, as amended by RA No. 11534 (CREATE Act).
The IRR shall apply to:
a. All existing Investment Promotion Agencies (IPAs) as defined in the Act or related laws with respect to the administration and grant of tax incentives unless otherwise specifically exempted from the coverage thereof;
b. All newly-registered projects or activities, including qualified expansion projects or activities of export enterprises and domestic market enterprises, under the Strategic Investment Priority Plan (SIPP);
c. Registered enterprises, projects or activities currently registered with IPAs and
enjoying incentives prior to the effectivity of the Act;
d. Other government agencies administering tax incentives with respect to the administration and grant of tax incentives and other registered enterprises availing of tax incentives; and
e. Government-Owned and/or –Controlled Corporations (GOCCs), Government Instrumentalities (GIs), government commissaries, and State Universities and Colleges (SUCs) that were granted tax subsidies under the tax expenditure fund of the Annual General Appropriations Act.
The Fiscal Incentives Review Board (FIRB), or the IPAs mentioned under Rule 1, Section 4(P) under a delegated authority from the FIRB, shall grant tax incentives to registered business enterprises only to the extent of their approved registered project or activity under the SIPP. The IRR has the following contents/information:
A. Under Rule 2 – Tax and Duty Incentives
i. Income Tax Holiday
ii. Special Corporate Income Tax
iii. Enhanced Deductions
iv. Customs Duty Exemption on Importation of Capital Equipment, Raw Materials,
Spare Parts or Accessories
v. Value-Added Tax (VAT) Zero-Rating and Exemption
vi. Other Incentives on Importation of COVID-19 Vaccines
vii. Other Incentives on Importation of Petroleum Products
viii. Taxation after the expiration of the period of availment of incentives
ix. Taxation of non-registered project or activity
B. Under Rule 3 – Period of Availment of Incentives
i. Period of availment for export enterprises
ii. Period of availment for domestic market enterprise
iii. Qualified expansion, entirely new project or existing registered projects or activities
iv. Start of period of availment
v. Prioritization and tiering
vi. Period of availment of incentives based on location and industry priorities
vii. Projects or activities located in areas recovering from armed conflict or a major
disaster
viii. Projects or activities relocating from the National Capital Region
ix. Review and revision
C. Under Rule 4 – Strategic Investment Priority Plan
i. General Principles
ii. Formulation
iii. Contents
iv. Criteria for Investment Priority Determination
v. Validity
vi. Mandatory Laws
vii. Steering Committee
viii. Amendments to the SIP
ix. Publication
D. Under Rule 5 – Scope
i. Authority of the FIRB to Grant Tax Incentives
ii. Authority of the IPAs
E. Under Rule 6 – Registration of Business Enterprise
i. Qualified Business Enterprise
ii. Qualifications for Registration
iii. Method of filing and Fees
iv. Basic Documentary Requirements
v. Incomplete Application
vi. IPA Evaluation Process
vii. FIRB Evaluation Process
F. Under Rule 7 – Action on the Registration
i. IPA Action and Notice to Applicant
ii. Certificate of Registration
iii. Conditions Precedent for Issuance of Certificate
iv. Issuance of Certificate
G. Under Rule 8 – Application for Tax Incentives
i. Filing of Application
ii. Form
iii. Application for Certificate of Entitlement to Tax Incentives (CETI)
iv. Issuance of CETI
v. Conditions for the Grant of Tax Incentives
vi. Finality of Decision on Application for Tax Incentives
vii. Monitoring Report
viii. Burden of Proof
H. Under Rule 9 – Customs Duty Exemption on Importation of Capital Equipment,
Raw Materials, Spare Parts and Accessories
i. Certificate of Authority to Import (CAI)/Admission Entry
ii. Application for Certificate of Authority to Import (CAI)/Admission Entry
iii. Validity of CAI/Admission Entry
iv. Performance Bond
v. Monitoring of the Imported Capital Equipment, Spare Parts and Accessories
I. Under Rule 10 – Power of the President to Grant Incentives
i. Power of the President to Grant Incentives
ii. Limitations to the Period of Incentives Availment
iii. Conditions for the grant
iv. Periodic review of thresholds
v. Cancellation of incentives
vi. Suspension of the power of the President to grant incentives
J. Under Rule 11 – Filing and Submission of the Annual Income Tax Incentives Report
i. Filing of Tax Returns and Payment of Tax Liabilities
ii. Submission of the Annual Tax Incentives Report (ATIR) and Annual Benefits
Report (ABR)
iii. Contents of the ATIR and ABR
iv. Role of the IPAs and OGAs administering tax incentives
v. Role of the BIR and the BOC
vi. Role of the FIRB
vii. Role of the DOF
viii. Role of the DBM
K. Under Rule 12 – Conduct of Impact Evaluation on Tax Incentives
i. Conduct of impact evaluation on tax incentives
ii. Third-party peer review
iii. Penalties for noncompliance with filing of ATIR and ABR
L. Under Rule 13 – Expanded Functions of the FIRB
i. Policy making and oversight functions
ii. FIRB oversight functions over other government agencies administering tax
incentives under Section 297(A)
iii. FIRB oversight functions over registered enterprises with tax incentives
iv. Power to approve or disapprove the grant of tax incentives
v. Power to formulate place-specific strategic investment plans
vi. Power to cancel, suspend or withdraw the enjoyment of tax incentives
vii. Power to require submission of incentives and benefits data
viii. Authority to publish incentives and benefits data
ix. Power to recommend the grant of non-fiscal incentives for highly desirable projects
x. Power to adopt policies for supply chain development and expansion
xi. Power to approve application for tax subsidies
xii. Power to cancel, suspend, or withdraw the enjoyment of tax subsidy
xiii. Submission of annual report to President
xiv. Evaluation of tax incentives granted to registered entities
xv. FIRB’s exercise of all necessary and incidental powers in accordance with its
expanded functions
M. Under Rule 14 – Fiscal Incentives Review Board Proper
i. Composition
ii. Powers and Functions of the Chairperson
iii. Meetings and Quorum
N. Under Rule 15 – Fiscal Incentives Review Board Technical Committee
i. Composition
ii. Roles and Responsibilities of the Technical Committee
iii. Meetings and Quorum
O. Under Rule 16 – Fiscal Incentives Review Board Secretariat
i. Composition and Responsibilities of the Secretariat
ii. Powers and Functions of the Head of Secretariat
P. Under Rule 17 – Transitory and Miscellaneous Provisions
i. Qualification for Registration
ii. Entitlement to Duty Exemption on Importation of Capital Equipment, Raw
Materials, Spare Parts or Accessories
Q. Under Rule 18 – Investments Prior to the Effectivity of the Act
i. Projects or activities granted only an ITH
ii. Projects or activities granted an ITH and are entitled to the 5% tax on gross
income earned
iii. Registered business enterprises currently availing of the 5% tax on gross income
earned
iv. Allocation of gross income earned
v. Non-income related tax incentives
R. Under Rule 19 – Prohibition on Registered Activities
i. General Rule
S. Under Rule 20 – One-Stop Action Center
i. Establishment of One-Stop Action Center
ii. Period to establish a One-Stop Action Center
T. Under Rule 21 – Forms and Certificates
i. Forms
U. Under Rule 22 – Misrepresentation and Violation of Other Provisions of the Code
i. Misrepresentation of information for the purpose of availing of incentives
ii. Violation of other provisions of the Act
iii. Observance of due process
iv. Effect of cancellation, suspension or withdrawal of fiscal incentives or tax
subsidy
V. Under Rule 23 – Temporary Measures for Exceptional Circumstances
i. Exceptional circumstances
ii. Implementation of the temporary measures
iii. Temporary measures
iv. Period
v. Effect on the incentives of the affected RBEs
vi. Availment of temporary measure
W. Under Rule 24 – Final Provisions
i. Web-based tax incentives and subsidies applications and monitoring system
ii. Revies of Rules and Regulations
iii. Separability Clause
iv. Effectivity