Question & AnswerQ&A (Republic Act No. 10708)
Republic Act No. 10708 is officially known as the Tax Incentives Management and Transparency Act (TIMTA).
The State's policy is to promote fiscal accountability and transparency in the grant and management of tax incentives by developing means to promptly measure government fiscal exposure, monitor, review, and analyze the economic impact, and optimize the social benefit of such incentives.
IPAs are government entities created by law or other issuance to promote investments, administer tax and non-tax incentives, and oversee operations of economic zones and freeports, including agencies such as BOI, PEZA, BCDA, and others.
Tax incentives are fiscal incentives such as income tax holidays, exemptions, deductions, credits, or exclusions from the tax base provided by law to registered business entities.
Any individual, partnership, corporation, Philippine branch of a foreign corporation, or entity incorporated or organized under Philippine laws and registered with an IPA.
Registered business entities must file their tax returns and pay tax liabilities through the BIR's electronic system, and submit an annual tax incentives report to their respective IPA within 30 days after the tax return deadline.
Penalties include a fine of P100,000 for the first violation, P500,000 for the second violation, and cancellation of registration for the third violation. Officials failing to provide required reports may face fines, suspension, or both.
The Bureau of Internal Revenue (BIR) and the Bureau of Customs (BOC) are required to submit tax and duty incentives data of registered business entities to the DOF.
The National Economic and Development Authority (NEDA) conducts cost-benefit analyses to determine the economic impact of investment tax incentives on the Philippine economy.
The Oversight Committee monitors proper implementation of the Act and is composed of the Chairpersons of the Senate and House Committees on Ways and Means, plus additional members including trade committee chairs from both Houses.