Attention Registered Business Enterprises (RBEs) and Export Companies!

The Philippine Economic Zone Authority (PEZA) has issued Memorandum Circular No. 2025-052, dated September 29, 2025, clarifying which local purchases of goods and services may qualify as VAT Zero-Rated under the CREATE MORE Act (Republic Act No. 12066).

Key Highlights

✓ Direct Attribution Required
Only goods and services directly attributable or reasonably necessary to your registered project or activity may qualify for VAT zero-rating.

✓ PEZA’s Authority Confirmed
PEZA, not the Bureau of Internal Revenue (BIR), is the Investment Promotion Agency (IPA) authorized to determine VAT zero-rating eligibility.

✓ Automatically Qualifying Purchases
Expenses listed in the “positive list” are deemed directly attributable. These include: rent, utilities, accounting, legal, janitorial, security, IT, HR, consultancy, logistics, and other similar services.

For Purchases Not on the Positive List

RBEs must first secure PEZA confirmation by submitting the following requirements:

1. Formal Letter Request (on company letterhead)
2. Notarized Sworn Affidavit (Form ERD.2.F.008) signed by the CEO, President, or equivalent officer
3. Send all documents via email to odg@peza.gov.ph with the subject line:
   Request for VAT Confirmation – [Name of Registered Business Enterprise]

Why This Matters

This circular aligns PEZA’s procedures with the CREATE MORE Act’s stricter VAT framework, ensuring that only purchases genuinely tied to your registered operations enjoy VAT zero-rating.

Non-compliance may result in VAT disallowances, deficiency assessments, or penalties during BIR post-audit.

Compliance Tip

Before claiming VAT Zero-Rating:

• Secure PEZA confirmation for non-listed purchases.
• Keep your Sworn Affidavit and related proofs ready for audit.

This helps preserve your tax incentives and protects your company from potential disputes.

Legal Basis

PEZA Memorandum Circular No. 2025-052
Dated September 29, 2025
Issued by: Dir. Gen. Tereso O. Panga
Subject: Clarification on VAT Zero-Rating for Goods and Services Directly Attributable to Registered Activities under the CREATE MORE Act (RA 12066)

Tax Advisory

If your company needs assistance with:

• Drafting the Sworn Affidavit or Letter of Request, or
• Evaluating which expenses may qualify for VAT Zero-Rating,

Bong Corpuz & Co. CPAs can help ensure your filings are compliant, well-documented, and aligned with both PEZA and BIR standards.

Talk to us today, let’s keep your compliance seamless and your incentives secure.