The CREATE MORE Act: What Philippine Businesses Need to Know And Do Now

In November, Republic Act 12066, also known as the CREATE MORE Act, was signed into law, amending the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act. This law is designed to simplify tax incentives, make compliance easier for businesses, and attract more investments to the Philippines.

What does this mean for your business? How will it impact cash flow, bookkeeping, and tax compliance? And why is it important to act now? Let’s break it down.

What is the CREATE MORE Act, and Why Was It Introduced?

The CREATE MORE Act builds on the reforms of the CREATE Act (RA 11534), which reduced corporate income tax rates and revised the country’s tax incentive system. However, many businesses still face complex compliance processes and administrative roadblocks.

CREATE MORE aims to:

✅ Make tax incentives simpler for registered business enterprises (RBEs).

✅ Streamline VAT exemption and refund processes.

✅ Encourage more local and foreign investments through better incentives.

✅ Reduce compliance burdens by digitizing tax processes and clarifying tax treatments.

How Will the CREATE MORE Act Impact Businesses?

1. How Does It Affect Cash Flow?

The new law introduces several changes that can help businesses manage their cash flow more efficiently:

✅ Lower withholding tax rates (RR 5-2025) on credit card payments and online marketplace transactions mean businesses get more cash upfront.

✅ VAT exemption for RBEs reduces out-of-pocket costs for purchasing goods and services.

✅ Faster VAT refund processing (RR 8-2025) helps businesses get tax refunds quicker, improving cash flow.

Why It Matters: If your business relies on steady cash flow—especially startups, exporters, and BPO firms—these changes can free up funds for growth.

2. What Does This Mean for Bookkeeping and Tax Compliance?

With new tax incentives and compliance rules, businesses must update their accounting and bookkeeping processes to stay compliant.

E-invoicing and digital sales reporting (RR 11-2025) are now required for certain businesses, meaning systems may need upgrades.

✅ VAT rules have changed (RR 10-2025), requiring adjustments in how businesses calculate and report taxes.

✅ Tax refund requests(RR 8-2025) must follow updated procedures, meaning businesses need better documentation and tracking.

Why It Matters: If you don’t adapt to these changes, you risk delays, compliance issues, and penalties.

3. Which Businesses Will Be Affected the Most?

While all businesses should be aware of the CREATE MORE Act, some industries will feel the impact more than others:

✅ Exporters & Registered Business Enterprises (RBEs) – Tax incentives and VAT exemptions provide cost savings.

✅ E-Commerce & Digital Services – Lower withholding tax on marketplace transactions helps cash flow.

✅ BPOs & IT Firms– Faster tax refunds improve operational efficiency.

✅ Manufacturing & Logistics – VAT rule changes and excise tax exemptions reduce costs.

✅ Startups & SMEs Expanding Locally– Compliance with new e-invoicing and VAT rules is now critical.

Why It Matters: If your business falls into these categories, you should act now to maximize tax savings and avoid compliance issues.

Why Should Businesses Act Now?

The CREATE MORE Act is already in effect, meaning businesses must adjust their tax strategies immediately. Delays in compliance could mean:

✅ Missed tax savings that could boost your bottom line.

✅ Penalties for incorrect tax reporting or failure to comply with e-invoicing requirements.

✅ Cash flow issues due to slow VAT refund processing if documentation isn’t prepared correctly.

Act Now: Don’t wait until tax season to address these changes. Start preparing now to maximize savings and stay compliant.

Need Help Understanding CREATE MORE? CloudCFO Has You Covered.

Navigating tax changes can be complex, but CloudCFO is here to help. Our expert team can:

✅ Assess how CREATE MORE affects your business

✅ Ensure compliance with new tax regulations

✅ Help you optimize your bookkeeping and cash flow

✅ Guide you in maximizing tax incentives

Get expert advice today! Complete the form on our website, or email us at hello@cloudcfo.ph.

Stay ahead of tax changes—partner with CloudCFO now!