BOI - Board of Investments Tax Incentives
A corporation investing in the Philippines may avail of tax breaks and incentives by registering with the BOI - Board of Investments. The company must operate a business which has been recognized as a preferred area of investment in the Philippines Investment Priority Plan (IPP). For business activities not covered by the IPP incentives may still be available if:
1. at least 50% of production / service is for exports, if Filipino-owned enterprise,; and
2. at least 70% of production / service is for exports, if majority foreign-owned enterprise (more than 40% foreign equity),
Fiscal incentives includes the following:
* Income Tax Holiday
* Exemption From Taxes And Duties On Imported Spare Parts
* Exemption From Wharfage Dues And Export Tax, Duty, Impost And Fees
* Tax Exemption On BreedingStocks And Genetic Materials
* Tax Credits
* Additional Deductions from Taxable Income.
Income Tax Holiday (ITH) Advantages
Companies registered with the BOI are eligible for income tax holidays which range form 3 - 8 years. 4 years for new projects without pioneer status and 6 years for projects with pioneer status.
A 100% foreign owned corporation may be entitled to incentives if their business has been categorized as a pioneer project and at least 70% of production / service is exported or the project is in one of the less-developed areas mentioned in the IPP. Companies not exporting 100% of their production / services are obliged to have 60% Filipino ownership within a period of 30 years from time of registration with the BOI. Foreign ownership of corporations in non-pioneer projects is limited to 40% except if the company exports more than 70% of its production / service.
How to apply for Board of Investment incentives:
Submission of a notarized application specifying the nature of the projects, its inclusion in the IPP or not, percentage of production for export, the investors details and a 5 year feasibility study.
PEZA offers other tax breaks.
Email or call us Tel.: 63 2 474-2732 for a consultation