President Rodrigo Duterte has signed into law a measure that finally lowers the highest corporate income tax in Southeast Asia.
Malacañang confirmed that Duterte signed the Corporate Recovery and Tax Incentives for Enterprises (CREATE) bill, which is now Republic Act No. 11534.
With this law, corporate income tax in the country, currently at 30%, is lowered to 25% for large corporations and 20% for small businesses.
Here is the signed law:
CREATE also overhauls tax incentives, making perks targeted, performance-based, and time-bound. (READ: [ANALYSIS] Will Duterte's new tax measure kill foreign investments?)
Joey Salceda, chair of the House of Representatives' ways and means committee, had called the CREATE measure the "greatest economic reform of the post-EDSA years." Finance Secretary Carlos Dominguez III had aggressively lobbied for the law.
In Duterte's March 26 letter to the Senate and House of Representatives, the President said the CREATE law will be a boon to Filipinos whose income have been affected by the COVID-19 pandemic.
"It comes at an opportune time, since it will serve as a fiscal relief and recovery measure for Filipino businesses still suffering from the effects of the COVID-19 pandemic," said Duterte.
However, the President vetoed certain provisions in the law. Presidents have such power when it comes to appropriation, revenue, or tariff bills.
Here are the lines he vetoed and his reasoning for the veto (the complete veto message is at the bottom of this article):
Pia Ranada covers the Office of the President and Bangsamoro regional issues for Rappler. While helping out with desk duties, she also watches the environment sector and the local government of Quezon City. For tips or story suggestions, you can reach her at email@example.com.