RR No. 13-2023 — Prescribes the policies and guidelines for the optional VAT-Registration of Registered Business Enterprises classified as Domestic Market Enterprise under the 5% tax on Gross Income earned in lieu of all taxes regime during the transitory period pursuant to Rule 18, Section 5 of the amended IRRs of Republic Act No. 11534 (CREATE Act) (Published in Malaya on November 15, 2023) Dige

REPUBLIC OF THE PHILIPPINES

BUREAU OF INTERNAL REVENUE DEPARTMENT OF FINANCE National Office Building Quezon City

NOV 1 0 2023

REVENUE REGULATIONS NO. 13 - 2O23

SUBJECT: Prescribing Policies and Guidetines for the Optional VAT-Registration

of Registered Business Enterprises Classified as Domestic Market

for Enterprises (CREATE) ACT Enterprise under the Five Percent (5%) Tax on Gross Income Earned In Lieu of All Taxes Regime During the Transitory Period Pursuant to Rule Republic Act No. 11534 or the "Corporate Recovery and Tax Incentives 18, Section 5 of the Amended Implementing Rules and Regulations of

TO: All Internal Revenue Officials, Employees and Others Concerned

Code, these Regulations are hereby promulgated to implement Section 5, Rule 18 of the amended Implementing Rules and Regulations (IRR) of Republic Act No. 11534 or the "Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act,"" which reads: SECTION 1. Scope. -- Pursuant to the provisions of Sections 244 and 245 of the Tax

"RULE 18. Investments prior to the effectivity of this Act.

XXX XXX XXX

(Underscoring supplied) economic or freeport zone during the transitory period will be allowed to registered project or activity of said registered export enterprises.' domestic enterprises that will continue to avail of their existing tax incentives transitory period referred to in Section 311(C) of the Act, whichever comes classified as [domestic market enterprise] DME which is located inside the register as a VAT taxpayer: Provided, finally, that the duty exemption, VAT exemption on importation, and VAT zero-rating on local purchases shall only apply to goods and services directly attributable to and exclusively used in the exemption, [value-added tax] VAT exemption on importation, and VAT zero- rating on local purchases as provided in their respective [Investment Promotion] defined under Section 293(E) of the Act whose income tax-based incentives have expired, may continue to enjoy VAT zero-rating on local purchases until the electronic sales reporting system of the Bureau of Internal Revenue under Section 237-A of the Act is fully operational, or until the expiration of the earlier; Provided,.further..that.an[registered business enterprise] RBE SECTION 5. Non-income related tax incentives. - All registered export and subject to Sections 1, 2 and 3 of this Rule, may continue to enjoy the duty Agency] IPA registrations; provided that registered export enterprises as

BUREAU OF INTERNAL REVENUE INTERNAL COMMUNICATIONS DIVISION NT NOV 1U 2023 IBUREAUOF TNtERNALREVENUE NNTYY 1:OV 10 2023 CORDNA T 4S R

RECORDS MGT DIVISION

These Regulations are hereby issued to provide guidelines in order for RBEs classified

of Internal Revenue (BIR). as DMEs during the transitory period to be able to register as VAT-taxpayers with the Bureau

during the ten (10) year transitory period under Section 311(C) of the CREATE Act and be be in lieu of all taxes except VAT. located inside the Economic or Freeport Zone may retain the availment of the 5% GIE incentive to it (Certification). The Certification shall expressly state that the five percent (5%) GIE shall Certification specifically excluding VAT from the 5% GIE in lieu of all taxes incentive granted allowed to register as a VAT taxpayer provided it secures from the concerned IPA a SECTION 2. Optional VAT-registration. - An RBE classified as DME which is

documentary requirements: For this purpose, such RBE shall submit to the concerned IPA the following

a. Request letter stating its intention to avail of the option to register as a IRR of the CREATE; VAT taxpayer with the BIR pursuant to Section 5, Rule 18 of the amended

b. Notarized "Deed of Waiver of Right to Avail of the VAT Exemption Incentive" in the form prescribed in Annex "A" of these Regulations; and

c.Other documents that may be prescribed by the concerned IPA.

from the time it is made and shall be binding in the remaining transitory period. The waiver of rights to avail of the VAT exemption incentive shall be irrevocable

registrations with the concerned Revenue District Office (RDO) to reflect their registration corporations insofar as the VAT imposition and compliance is concerned. from non-VAT to VAT taxpayer. Consequently, such RBE shall be treated on par with regular Non-VAT registered RBEs that have been issued the Certification shall update their

Internal Revenue may prescribe a report template in a separate revenue issuance. Regulations, the concerned IPA shall furnish the BIR through the Assessment Service, Attention: Audit Information, Tax Exemption and Incentives Division (AITEID) within twenty (20) days following the close of each taxable quarter a list of RBEs that have been issued the Certification. In order to obtain relevant information, for audit purposes, the Commissioner of SECTION 3. Monitoring and Reporting. -- Upon the effectivity of these

be allowed to claim for VAT refund relating to its transactions prior to the effectivity of the accordance with Section 3 of the Amended IRR of CREATE. DMEs inside the economic or freeport zone that will opt to register as VAT taxpayers pursuant to these Regulations shall not Amended IRR of CREATE. SECTION 4. Applicability. - These Regulations shall apply prospectively in

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NOV 10 2023 CMDNO 74 I Page 2 of 3

RECOAUS vCI DIVISION

issuances or parts thereof inconsistent with the provisions of these Regulations are hereby repealed, amended or modified accordingly. SECTION 5. Repealing/Amendatory Clause. -- Any rules and regulations,

is subsequently declared unconstitutional, the validity of the remaining provisions hereof shall remain in full force and effect. SECTION 6. Separability Clause. ---- If any of the provisions of these Regulations

its publication in a newspaper of general circulation or in the Official Gazette, whichever comes first. SECTION 7. Effectivity. ---- This issuance shall take effect immediately following

C.C BENJAMIN E. DIOKNO Secretary of Finance

O CT 3 1 2023 Recommending Approval:

LUMAAUI, JR Cor I Kissioner of Int nal Revenue

016094

K-1 - ACGM

BUREAU OF INTERNALREVENUE NNT NOV 10 2023 RDAVO 1:4s pm

RECORDS MGT.DIVISION

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