House adopts report fixing issues from CREATE IRR

By Jovee Marie N. dela Cruz @joveemarie

gistics service enterprises (LSEs) to VAT zero-rating on their local purchases.

So, piece by piece, the DOF, DTI, and BIR are responding to the recommendations of the committee,” he said.

be resolved through executive issuances.” velopment Bank’s survey reaffirms that we are indeed living out our mission of creating flexible earning opportunities for thousands of Filipinos. We are committed to continuously enhance the livelihoods of our partners, deliver value to our consumers, while building a sustainable ecosystem for all our stakeholders,” she said.

T he ADB study noted, however, that there are operational hazards on this type of career and emphasized the need for affordable medical insurance schemes to promote the long-term sustainability of this flexible self-employment model.

Vera Cruz noted that Grab Philippines has a comprehensive health and safety policy to support its delivery-partners. This includes accident and life insurance, medicine allowance, access to prepaid ER HMO, hospital assistance, 24/7 Grab Safety Hotline, Grab Academy safety training, and telemedicine services.

S he also claimed that Grab is the first platform in the Philippines to offer a “robust and comprehensive social protection scheme to its partners - with Grab even subsidizing its partners’ first-month contributions.”

Vera Cruz was referring to contributions to the Social Security System, Pag-IBIG Fund, and PhilHealth.

She noted that the findings of the ADB study reveled that Grab “is not only a tech success story, but a resilient economic pillar supporting the livelihoods of countless Filipinos.”

“ This report also reminds us that there is always room to kaizen. We will continue to seek innovative solutions to further enhance our drivers’ welfare and safety while delivering exceptional services to our customers. Our goal is not just to be a super app - we aim to be a super partner to every Filipino,” said Vera Cruz. Lorenz S. Marasigan

T he report, written by the Committee on Ways and Means chaired by Albay Rep. Joey Sarte Salceda, was the result of extensive deliberations called for by House Resolutions No. 490 and 611.

A ccording to Salceda, he received assurances that the Department of Finance would act on the resolution.

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In the coming days, they will issue amendments to the CREATE Law IRR so that registered export enterprises can continue to avail of VAT zero-rating throughout the transition period and that domestic market enterprises inside ecozones will be allowed to register as VAT taxpayers so they can avail of the VAT refund system,” Salceda said.

“ We hope to put all questions about CREATE’s IRR to rest before the year ends,” Salceda added.

D uring the course of discussions for the Committee Report, the lawmaker said the DOF and the BIR also issued Bureau of Internal Revenue (BIR) RMC No. 24-2023 clarifying the entitlement of lo -

The committee found glaring inconsistencies between the letter and intent of the CREATE law and the rules and regulations issued to implement its provisions. These inconsistencies were abject in (1) the disrespect for the transition period prescribed under Section 311 of the Tax Code about the VAT privileges attached to the preferential five percent (5%) tax on gross income earned (GIE); and (2) the distinction between registered domestic and export enterprises in applying VAT privileges, when the law did not make such distinctions,” said the report.

W ith the coming amendments, Salceda said, “We expect issue no. 1 to be resolved. Issue No. 2 will still be pending, so we hope the DOF and DTI can resolve that.”

S alceda said the committee came up with the 68-page report to emphasize “that the problems cited about CREATE Law are matters of interpretation and can

Representatives from the business sector have brought these VAT issues to the President’s attention and have cited them as affecting our competitiveness as an investment destination. So, we worked with the DOF, DTI, and other agencies to address them as much as we can,” Salceda added.

A part from issuances related to the CREATE Law, the committee report also recommended that the DTI-BOI expand its reach as a nonzone-based investment promotion agency (IPA) by integrating incentive promotion in its DTI regional offices.

T he report also recommended that the BIR improve the processing of VAT refund claims and that the concerned government agencies submit periodic status reports to the committee pursuant to Section 290 of the NIRC of 1997, as amended.

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The DTI and BOI have to proactively expand access to investment promotion services across the regions, and the BIR must take cognizance of its role to enable businesses so that we can collect more revenues from a bigger pie,” he said.