The government has moved to eliminate long-standing confusion over local taxation for investment-registered firms, with a new joint circular expected to streamline compliance, improve policy consistency, and strengthen the Philippines’ appeal to investors.
Joint Memorandum Circular (JMC) No. 01-2026, issued by the Department of Finance, Department of the Interior and Local Government, and Department of Trade and Industry, clarifies how local taxes, fees, and charges should be applied to registered business enterprises (RBEs) enjoying incentives under the CREATE and CREATE MORE laws.
The circular addresses one of the more persistent concerns raised by investors: varying interpretations of tax rules across local government units (LGUs). By establishing a uniform framework, the government hopes to reduce regulatory uncertainty and make compliance more predictable nationwide.
Under the guidelines, the Registered Business Enterprise Local Tax (RBELT) may be imposed at up to 2% of gross income and, once adopted through a local ordinance, will replace all other local taxes on qualified enterprises.
The circular also allows investment promotion agencies and LGUs to enter into collection and remittance agreements, a move aimed at improving coordination and reducing administrative friction for businesses.
The reform is seen as a key step in translating the incentives promised under CREATE and CREATE MORE into a more consistent on-the-ground experience for investors. While the tax incentives themselves have long been in place, implementation has often varied across jurisdictions, creating uncertainty for companies assessing expansion plans.
According to the Fiscal Incentives Review Board, consultations were conducted nationwide to help stakeholders understand the new framework and ensure smoother implementation.
FIRB Chairperson and Finance Secretary Frederick D. Go said the measure is intended to make compliance easier and provide greater clarity for investors.
The circular could offer businesses’ certainty, something often valued as much as incentives themselves.
