CREATE MORE Is Ratified: New Tax Incentives That Could Fund Your 2025 Digital Upgrade

CREATE MORE Is Ratified and Waiting on the President's Desk

Before Congress adjourned on September 25, 2024, both chambers ratified the bicameral conference committee report on CREATE MORE, the package meant to make tax incentives cheaper to keep and easier to claim. The bill is now with the President, and it is not law yet. If you are drafting a 2025 IT budget this month, read it before the ink dries.

CREATE MORE is not a new tax system. It amends the regime created by the CREATE Act (Republic Act 11534, 2021): who keeps incentives, for how long, and how easily they are claimed. An RBE is a registered business enterprise — one registered with an IPA, or investment promotion agency, like PEZA or BOI.

This has been a dense year: RR 7-2024 replaced the official receipt with the invoice for services, RA 12023 took effect in October, and now this — after the Ease of Paying Taxes Act changes we walked through in January.

The CREATE MORE Incentives That Actually Touch an IT Budget

The first number is the corporate income tax rate. Under the bill as ratified, RBEs on the enhanced deduction regime would pay 20% instead of 25% — the bicameral conference committee approved that cut in September.

The second is local tax. RBEs on either track would pay at most 2% of gross income in lieu of all other local taxes and fees.

	Income tax holiday (ITH)	Enhanced deduction regime (EDR)
What it does	No corporate income tax for a period	You pay tax, but deduct more costs
What the bill changes	Local tax capped at 2% of gross	Same cap, plus 25% to 20% and added deductions

Per the bill as ratified. Not yet signed.

Three provisions matter operationally:

• Additional and increased deductions under the EDR.
• Streamlined VAT refunds — money back faster is working capital for equipment.
• VAT and duty incentives clarified and extended to non-registered exporters and high-value domestic market enterprises.

Deductions change how a capital purchase reads on paper, and the list is unglamorous: a server refresh past warranty, an ERP or HRIS rollout, custom software built around how your business actually operates replacing spreadsheet workarounds.

Who Actually Qualifies — and Who Doesn't

These incentives run through IPA registration. A machine shop in Biñan, a five-person agency, or a retailer not registered with PEZA or BOI does not get the 20% rate. It is not a general corporate tax cut, and we would rather say so.

If that is you, two things still apply: policy is moving to lower the cost of modernization, and IT expenses stay deductible under existing rules.

Either way, ask your accountant in writing whether you are IPA-registered and under which regime. Most owners do not know.

The Year-End Clock: Why November Is the Wrong Month to Wait

The urgency here is calendar, not legal. The bill would also spell out how existing registrants move into the new regime, but none of that is settled today.

December is settled: closing books, 13th-month pay due on or before December 24, inventory, holiday demand, skeleton crews. A November decision that slips becomes a January one, so talk to your accountant now.

The 13th-month disbursement plus BER-month payables makes the tightest four weeks of the year. Lock quotes, specs, and lead times now, so a January purchase order is a signature, not a project.

The honest part: nobody can say what CREATE MORE would save you in pesos. It is not signed, and the implementing rules do not exist. Any decision now stands on the project's own payback, with incentives as upside.

The Other Half of the Math: VAT on Digital Services Is Already Law

One bill may lower what registered enterprises pay; another already-signed law will raise what nearly every business pays for software. RA 12023 was signed on October 2, 2024 and took effect October 18, putting 12% VAT on foreign digital service providers: cloud, online marketplaces, online advertising. We covered the new 12% VAT on digital services and who actually pays it.

Nothing is collected from nonresident providers yet: the DOF has 90 days for the rules plus a 120-day transition. It is a 2025 budget line, not a November shock.

This month, list every foreign-billed subscription — cloud hosting, productivity suites, accounting SaaS, ad platforms, design tools — and add a 12% contingency in the 2025 draft.

Turning Tax Incentives Into an Actual Digital Upgrade

Incentives lower the cost of a project; they do not make the case for one. The work worth funding pays back on its own: ending double-encoding, replacing manual reconciliation, retiring a server past warranty, shortening a two-week close.

Documentation matters, because incentive regimes reward registered, properly invoiced activity. After the 2024 shift from official receipt to invoice for services, check with your bookkeeper that what vendors issue matches what your records need.

Predictable cost is the other half: turning break-fix spending and thin IT headcount into one monthly figure through managed IT outsourcing gives you a budget you can defend line by line. On whether a system is worth building, six ways custom software helps a business grow is the better start.

What we see with our clients: the businesses that get value from a tax change already had a shortlist ready.

Your November Checklist Before the Bill Becomes Law

• Confirm in writing whether you are IPA-registered, and under which regime.
• Inventory every foreign-billed subscription and add 12% to the 2025 figure.
• Draft the 2025 IT capex list and get quotes this month, not January.
• Ask your accountant which regime, ITH or EDR, the numbers favor.
• Watch for the signing and the implementing rules. They do not exist yet, so anyone quoting exact savings is guessing.

Whether or not CREATE MORE applies to you, the 2025 IT budget conversation has to happen this month, while there is room to move. If it helps, book a short call with us and we will go through what is worth funding next year.