Tax Incentives in the Philippines: Options Available to Foreign Companies

Philippine Economic Zone Authority (PEZA)

Foreign companies engaging in the export industry in the Philippines, including outsourcing and offshoring business operations, may consider registering with PEZA.

If deemed eligible, foreign enterprises will be entitled to tax holidays with a validity of either four, six or eight years. After the validity period expires, foreign enterprises will be subject to 5% tax on gross income. This applies as a substitute for all taxes, both local and national.

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To qualify for PEZA’s tax breaks and tax incentives, business operations must be situated in one of these places: PEZA-registered economic zones, technology parks, IT parks or office buildings. Enterprises are also required to export 100% of their production.

To apply for tax incentives from PEZA, foreign enterprises must fulfill necessary documents, which are as follows:

  • SEC Certificate of Registration.
  • Articles of Incorporation and By-Laws.
  • Project Brief.
  • Anti-Graft Certificate.
  • Filing and designation of a representative authorised by Board Resolution.
  • Project Feasibility Study.

Board of Investments (BOI)

Foreign companies whose business activities are mainly related to business process outsourcing, such as call centers and IT services, may consider registering their businesses with BOI. Other companies engaging in activities that promote the general economic development of the country or activities determined to be part of investment priorities are also allowed to apply for tax incentives offered by BOI.


If deemed eligible, foreign enterprises will be entitled to income tax holidays of four to eight years as well as being exempted from local business taxes of four to six years (for pioneer and non-pioneer industries, with different requirements).

To qualify for tax breaks and other incentives from the BOI, foreign companies are required to have an equity investment in a legal Philippine corporation.

To apply for tax incentives from the BOI, documents to be submitted include:

  • Project Type.
  • Enterprise’s Capital Structure.
  • How business activities are related to the ones under the Investment Priorities Plan.
  • Nationality of investors.
  • Feasibility Report.
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Cagayan Economic Zone Authority (CEZA)

Foreign companies engaging in tourism-related activities (entertainment, amusements, games, etc.) and sports and recreation-related activities (horse racing, gambling, virtual gaming, online gaming, etc.) in may consider registering their businesses with CEZA.

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If deemed eligible, foreign enterprises will be entitled to tax incentives that include income tax holidays of four to six years, 5% special tax on gross income as a substitute for all taxes both local and national, tax credits, tax and duty-free importation of capital equipment and zero-rating for articles admitted to the zone under legal permit.

To apply for tax incentives by CEZA, documents to be submitted include:

  • Accomplished Application Form.
  • Project Feasibility Study.
  • Evidence of intended enterprise’s physical location within the Cagayan Special Economic Zone and Freeport.
  • List of assets and other properties.

The Tourism Infrastructure and Enterprise Zone Authority (TIEZA)

Foreign companies engaging in tourism-related activities (such as travel and tour agencies, tour guides, restaurants, spas, theme parks, and galleries) within the Tourism Enterprise Zone, with the main purpose of attracting as many visitors as possible to travel to and in the Philippines, may consider registering their businesses with TIEZA.

If deemed eligible, foreign enterprises will be entitled to fiscal incentives that include income tax holidays, 5% tax on gross income and exemption from local duties and non-fiscal incentives that include work visasSpecial Investor’s Resident Visa, and repatriation of investment.

Want to know more about tax incentives in the Philippines to maximise your company’s financial savings? Start by filling out the form below.

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David Susandi

Branch Manager – Bali Office at InCorp Indonesia

Holding 11 years of experience in various roles, including project manager, operational manager, and corporate strategist, David Susandi is a prominent figure for many entrepreneurial organizations expanding in Indonesia.

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Disclaimer: The information is provided by PT. Cekindo Business International (“InCorp Indonesia/ we”) for general purpose only and we make no representations or warranties of any kind.

We do not act as an authorized government or non-government provider for official documents and services, which is issued by the Government of the Republic of Indonesia or its appointed officials.

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