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The Department of Finance, together with the Department of the Interior and Local Government and the Department of Trade and Industry, issued a joint circular that clarifies rules on local taxes for Registered Business Enterprises in economic zones
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The joint memo, which took effect on March 30, 2026, addresses ambiguities arising from varying interpretations and implementation of the CREATE and CREATE MORE Acts
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It provides businesses, local government units, and investment promotion agencies with a clearer and more uniform framework for local tax administration nationwide
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Guidelines include: Investment promotion agencies may enter into a memorandum of agreement with local governments to facilitate the collection, sharing, and remittance of RBE local tax; the tax shall not exceed 2% of the gross income of the RBE’s registered project or activity, and will be in lieu of all local taxes, fees, and charges, including local business taxes and real property taxes
The Department of Finance (DOF), together with the Department of the Interior and Local Government and the Department of Trade and Industry, issued a joint circular that clarifies rules on local taxes for Registered Business Enterprises (RBEs) to further improve ease of doing business.
Joint Memorandum Circular (JMC) No. 01-2026 – or the Guidelines on the Imposition of Local Taxes, Fees, and Charges on RBEs Availing of Tax Incentives Under Republic Act No. 12066 – is intended to standardize the application of local taxes on RBEs nationwide.
The JMC, which took effect on March 30, 2026, addresses ambiguities arising from varying interpretations and implementation of the CREATE and CREATE MORE Acts, particularly for transitioning RBEs, the Finance department said in a press release.
The CREATE – Corporate Recovery and Tax Incentives for Enterprises – Act under Republic Act No. 11534 (passed in 2021) and the CREATE MORE – CREATE to Maximize Opportunities for Reinvigorating the Economy Act – under Republic Act No. 12066 (passed in 2024) are designed to attract foreign and domestic investments by streamlining tax perks, other incentives, and easing the rules of doing business.
READ: CREATE MORE Act IRR signed
The joint circular, DOF said, “provides businesses, local government units (LGUs), and investment promotion agencies (IPAs) with a clearer and more uniform framework for local tax administration to promote ease of doing business, encourage compliance and strengthen investor confidence.”
It states that Registered Business Enterprise Local Tax (RBELT) applies to RBEs availing of Income Tax Holiday or Enhanced Deductions Regime in economic zones, including expansion areas, under the CREATE MORE Act.
It also provides that IPAs may enter into a memorandum of agreement with local governments to facilitate the collection, sharing, and remittance of RBELT.
In addition, the JMC provides that the RBELT, which shall not exceed 2% of the gross income of the RBE’s registered project or activity, shall be in lieu of all local taxes, fees, and charges, including local business taxes and real property taxes.
Once an LGU imposes the RBELT through an ordinance, it may no longer separately impose other local taxes outside the RBELT framework.
The guidelines further clarify that when an IPA owns the land but grants beneficial use to an RBE, the RBE shall be considered the taxable person and may be liable for real property taxes and other applicable local taxes, including the RBELT.
“Our goal is to translate policy into practice — ensuring that reforms are delivered, translated, and felt by our investors,” said Finance secretary Frederick Go, who also chairs the Fiscal Incentives Review Board (FIRB).
“The CREATE MORE Act was designed to make the Philippines a more competitive and investment-friendly destination. Our responsibility now is to ensure that its provisions are implemented clearly, consistently, and effectively. Through clear guidance and coordinated implementation, we are making compliance easier, providing greater predictability, and encouraging more investments into the country,” Go said.
To support implementation, the FIRB Secretariat conducted nationwide town hall meetings on May 5, 12, and 14, 2026, to brief stakeholders on the application of the RBELT.
READ: BIR launches dedicated office for enterprises with tax incentives
