RR No. 16-99: Amends RR No. 1-95 and other related rules and regulations relative to the grant of tax incentives to enterprises registered in the Subic Special Economic and Freeport Zone

Summary

RR No. 16-99, issued November 23, 1999, amends RR No. 1-95 and related rules on tax incentives for enterprises registered in the Subic Special Economic and Freeport Zone.

Key points

1. Regional headquarters in Subic. A multinational company engaged in regional and/or international trade, services and business activities may set up its seat of management and the situs of its business transactions in the Zone. This includes recording its income from some or all countries in the Asia-Pacific region and or other parts of the world, including the Philippines.
2. Registration. The company must register as a Subic Bay Regional Enterprise (SBRE) with the Subic Bay Metropolitan Authority.
3. 5% tax. A registered SBRE pays a tax of 5% on gross income earned from business transactions in some or all countries in the Asia-Pacific region and/or other parts of the world, including the Philippines.
4. Customs Territory income. The SBRE may earn up to 50% of its total revenues from sources within the Customs Territory, taxed at 5% on gross income. If revenues from the customs territory exceed 50% of total revenues, the excess income is subject to the regular income tax rates in the customs territory.

Who is affected

• Multinational companies registering as a Subic Bay Regional Enterprise in the Subic Special Economic and Freeport Zone

Deadlines and effectivity

• Issued November 23, 1999

Summary by Tax Resources PH. It is not a substitute for the full text of the issuance or professional advice.