How the CREATE MORE Act (RA 12066) rewards registered business enterprises with income tax holidays, the 5% SCIT and enhanced deductions — and why it funds registered activity, not the purchase of AI software.

dgm is an independent osFoundry implementation partner — not affiliated with osFoundry’s developer (the company OS LLC), and it has not yet completed any client integrations.

The CREATE MORE Act (Republic Act No. 12066, signed 11 November 2024) is the current incentive regime — it rewards registered business enterprises, not the purchase of AI software.

What the scheme actually gives

  • Income Tax Holiday of 4 to 7 years, then either the 5% Special Corporate Income Tax (SCIT) on gross income earned or the Enhanced Deductions Regime (EDR) taxed at 20% CIT.
  • Under the EDR, additional deductions including a 100% deduction on power expense (raised from 50%), 50% on labor, and 100% on R&D and training.
  • Total incentive periods extended to up to 17 years (IPA-granted) or up to 27 years (FIRB / large projects); the IRR took effect 17 February 2025.

Does it fund buying AI software?

Every CREATE MORE benefit accrues to the registered enterprise’s own tax bill for its registered activity; there is no mechanism that reimburses a company for buying AI software. A platform such as osFoundry lowers the cost structurally through usage-based pricing and the BYOK principle — which helps more than waiting for support that does not cover software.

Important note

This article is general information and is not legal, tax or grant advice. Tax incentives, grants, rules and rates change, and only the relevant authorities (among them the National Privacy Commission, the Bureau of Internal Revenue, PEZA, the Board of Investments, the Bangko Sentral ng Pilipinas and the SEC) decide eligibility and awards. dgm is not a registered business enterprise, accredited incentive provider or intermediary. Always confirm the current terms with the official source or a qualified tax or legal adviser.

How dgm helps

dgm is an independent implementation partner that helps businesses in the Philippines adopt osFoundry — from identifying the first practical use case, through building it, to connecting AI to the systems you already use. dgm works independently of osFoundry’s developer (the company OS LLC) and has not yet completed any client integrations; everything above is therefore a description of the service offered, not a delivered result. If you would like to look at a sensible first step, dgm is happy to think it through with you. Arrange a no-obligation conversation with dgm.