PEZA is attached to the Philippine Department of Trade and Industry (DTI). PEZA is the Philippine government agency tasked to promote investments, extend assistance, register, grant incentives and facilitate the business operations of investors in export-oriented manufacturing and service facilities inside selected areas throughout the country proclaimed by the President as PEZA Special Economic Zones (ecozones).
The PEZA Special Economic Zones has earned the trust of investors with its many locations throughout the Philippines ready for development, offered at a secured and competitive prices. Under PEZA, companies can avail of tax incentives and other benefits.
PEZA’s dynamic, responsive and client-oriented ethics have earned the trust and confidence of foreign and local investors and the Philippines Foreign Chambers of Commerce in its Special Economic Zones and tax incentives.
PEZA is ISO 9001:2000 certified.
Incentives for Ecozone and IT Locators
- Income Tax Holiday (ITH) – 100% exemption from corporate income tax:
◦ 4 years ITH for Non-pioneer project
◦ 6 years ITH for Pioneer project
◦ 3 years ITH for Expansion project (ITH applies to incremental sales) - Upon expiry of the Income Tax Holiday – 5% Special Tax on Gross Income and exemption from all national and local taxes. (“Gross Income” refers to gross sales or gross revenues derived from the registered activity, net of sales discounts, sales returns and allowances and minus cost of sales or direct costs but before any deduction is made for administrative expenses or incidental losses during a given taxable period)
- Exemption from Wharfage Dues and Export Taxes, Imposts and Fees
- Special Non-Immigrant Visa 47(a)2 with Multiple Entry Privileges for the following non-resident Foreign Nationals in a PEZA-registered Economic Zone Enterprise : Investor/s, officers, and employees in supervisory, technical or advisory position, and their spouses and unmarried children under twenty-one years of age. PEZA extends Visa Facilitation Assistance to foreign nationals their spouses and dependents.
- Employment of foreign nationals
- Simplified Import and Export procedures
Other incentives under Executive Order 226 (Omnibus Investment Code of 1987), as may be determined by the Philippine Economic Zone Authority Board.
Note: The companies registered with the Subic Bay Metropolitan Authority (SBMA) or Subic Bay Freeport Zone and the Clark Freeport Zone (CDC), are not eligible for the Income Tax Holidays, but will enjoy a 5% tax on gross income.
To benefit of PEZA’s tax breaks and incentives, a company needs to register and locate its operations in one of the PEZAs’ Special Economic Zones, IT Parks, Technology Parks, or buildings. Businesses inside the PEZA zones must export 100% of their production/services but in some special cases an exemption can be granted for the sale of up to 30% of its production/services to be sold in the domestic market.
A company located in the PEZA zone may be 100% foreign owned business as long as its activities are not listed in the Foreign Investment Negative List. The registration approval and the incentives granted by PEZA is given on a case by case basis.
The establishment of PEZA and the laws regulating its tax incentives and other benefits available to investors in the Philippines Special Economic Zones was enacted by the Special Economic Zone Act of 1995 (Republic Act No. 7916).
For companies that will not avail of PEZA incentives see the rules on foreign ownership of Philippine companies.
Tax breaks and incentives of the Philippines Board of Investments