Which figures are out of date — the EDR rate, the software-royalty withholding tax and the new VAT on digital services — so you do not rely on stale information.

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.

Some figures that still appear in search are out of date — do not plan around stale information.

What the scheme actually gives

  • EDR CIT rate: registered enterprises under the Enhanced Deductions Regime are now taxed at 20%, reduced from 25% by CREATE MORE — do not cite 25% for EDR enterprises.
  • Power-expense deduction: raised to 100% under CREATE MORE (was 50%); incentive durations now reach up to 17 years (IPA) or 27 years (FIRB), no longer capped at 10.
  • Software royalty withholding tax: use 25%, not the legacy 32% from RMC 44-2005; and the 12% VAT on non-resident digital services (collection from 2 June 2025) is new — any pre-2025 claim that foreign SaaS was VAT-free is stale.
  • SIPP edition: cite the 2026 SIPP, not the 2022 or 2025 edition.

Does it fund buying AI software?

Always confirm a scheme is still active and a rate is current at the primary source (the BIR, PEZA, the BOI, DOST) before planning around it. 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.