Board of Investments Tax Incentives

Fiscal and Non-Fiscal Incentives are available to BOI-registered enterprises as may be determined by BOI.


Fiscal Incentives:

  • Income Tax Holiday (ITH)
    • BOI-registered enterprise shall be exempt from payment of the income taxes reckoned from the scheduled start of commercial operations, as follows:
      • New projects with a pioneer status for six (6) years;
      • New projects with a non-pioneer status for four (4) years;
      • Expansion projects for three (3) years. As a general rule, exemption is limited to incremental sales revenue/volume;
      • New or expansion projects in less developed areas for six (6) years, regardless of status; and
      • Modernization projects for three (3) years. As a general rule, exemption is limited to incremental sales revenue/volume.
    • New registered pioneer and non-pioneer enterprises and those located in the less developed areas (LDAs) may avail of a bonus year in each of the following cases: 6 years ITH for Pioneer Project.
      • The indigenous raw materials used in the manufacture of the registered product must at least be fifty percent (50%)of the total cost of raw materials for the preceding years prior to the extension unless the Board prescribes a higher percentage; or
      • The ratio of total imported and domestic capital equipment to the number of workers for the project does not exceed US$10,000 to one (1) worker; or
      • The net foreign exchange savings or earnings amount to at least US$500,000 annually during the first three (3) years of operation.

      In no case shall a registered pioneer firm avail of this incentive for a period exceeding eight (8) years.

  • Exemption from taxes and duties on imported spare partss – A registered enterprise with a bonded manufacturing warehouse shall be exempt from customs duties and national internal revenue taxes on its importation of required supplies/spare parts for consigned equipment or those imported with incentives.
  • Exemption from wharfage dues and export tax, duty, impost and feess – All enterprises registered under the IPP will be given a ten (10) year period from date of registration to avail of the exemption from wharfage dues and any export tax, impost and fees on its non-traditional export products.
  • Reduction of the Rates of Duty on Capital Equipment, Spare parts and Accessories.
  • Tax Credits – Tax credit on raw materials and supplies. A tax credit equivalent to the national internal revenue taxes and duties paid on raw materials, supplies and semi-manufacture of export products and forming part thereof shall be granted to a registered enterprise.
  • Additional Deductions from Taxable Income – Additional deduction for labor expense (ADLE). For the first five (5) years from registration, a registered enterprise shall be allowed an additional deduction from taxable income equivalent to fifty percent (50%) of the wages of additional skilled and unskilled workers in the direct labor force. The incentive shall be granted only if the enterprise meets a prescribed capital to labor ratio and shall not be availed of simultaneously with the ITH. This additional deduction shall be doubled if the activity is located in an LDA.


Non-Fiscal Incentives:

  • Employment of Foreign Nationals – A registered enterprise may be allowed to employ foreign nationals in supervisory, technical or advisory positions for five (5) years from date of registration, extendible for limited periods at the discretion of the Board. The positions of President, General Manager and Treasurer of foreign-owned registered enterprises (more than 40%) or their equivalent shall, however, not be subject to the foregoing limitations.
  • Simplification of customs procedures for the importation of equipment, spare parts, raw materials and supplies and exports of processed products.
  • Importation of consigned equipment for a period of 10 years from date of registration, subject to posting of a re-export bond equivalent to 100% of the estimated taxes and duties.
  • The privilege to operate a bonded manufacturing/trading warehouse subject to customs rules and regulations.

 

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Why choose Science Park of the Philippines?

SPPI was established in 1989, and through the years, has gained the reputation of being a cutting edge developer of industrial estates through its Light Industry & Science Park projects.

Today, SPPI is highly regarded as one of the pioneers and leaders in private industrial estate development in the country and has the largest hectarage of industrial estates developed, and being developed with almost 800 hectares of aggregate area.