AAC Tax Code.

The period of availment of incentives granted by the Fiscal Incentives Review Board to RBEs shall be as follows:

(A) For an export enterprise under the SIPP, ITH of four (4) to seven (7) years, depending on location and industry priorities as specified in this section, followed by SCIT or EDR for twenty (20) years, or SCIT or EDR for a maximum period of twenty-four (24) to twenty-seven (27) years, depending on location and industry priorities: Provided, That the application for extension of availment of incentives shall only be allowed for the same registered project or activity if such project or activity employs at least ten thousand (10,000) direct local employees and maintains the said number during its registration, even if the registered project or activity no longer complies with the conditions and qualifications set forth in the SIPP: Provided, further, That the extension of availment of incentives shall not exceed ten (10) years, subject to the performance review by the Fiscal Incentives Review Board. Notwithstanding any provision to the contrary, no ITH shall be granted to registered export enterprises that have applied for extension of availment of incentives for the same project or activity.

A qualified expansion project or activity registered under this Act may qualify to avail of SCIT or EDR for thirteen (13) years, subject to the provisions of Sections 294(B) and (C), qualifications set forth in the SIPP and performance review by the Fiscal Incentives Review Board: Provided, That existing registered projects or activities prior to the effectivity of this Act may qualify to register and avail of the incentives granted under this Act for the prescribed period, subject to the criteria and conditions set forth in the SIPP. The

qualified expansion project or activity may also be entitled to VAT exemption on importation and VAT zero-rating on local purchases under Section 294(E) and duty exemption on importation under Section 294(D).

(B) For domestic market enterprise under the SIPP, ITH of four (4) to seven (7) years, followed by EDR for twenty (20) years, or EDR for a maximum period of twenty-four (24) to twenty-seven (27) years, depending on location and industry priorities: Provided, That the application for extension of availment of incentives shall be allowed for the same registered project or activity only if employment level for such project or activity employs at least ten thousand (10,000) direct local employees and maintains the said number during its registration, even if the registered project or activity no longer complies with the conditions and qualifications set forth in the SIPP: Provided, further, That the extension of availment of incentives shall not exceed ten (10) years, subject to the performance review by the Fiscal Incentives Review Board. Notwithstanding any provision to the contrary, no ITH shall be granted to domestic market enterprises that have applied for extension of availment of incentives for the same project or activity.

A qualified expansion project or activity registered under this Act may qualify to avail of EDR for thirteen (13) years, subject to the provisions of Section 294(C), qualifications set forth in the SIPP, and performance review by the Investment Promotion Agency or Fiscal Incentives Review Board, as the case may be: Provided, That existing registered projects or activities prior to the effectivity of this Act may qualify to register and avail of the incentives granted under this Act for the prescribed period, subject to the criteria and conditions set forth in the SIPP. The qualified expansion project or activity may also be entitled to VAT exemption on importation and VAT zero-rating on local purchases under Section 294(E) and duty exemption on importation under Section 294(D).

The period of availment of the foregoing income tax-based incentives shall commence from the actual start of commercial operations with the RBE availing of the tax incentives within three (3) years from the date of registration, unless otherwise provided in the SIPP and its corresponding guidelines.

The period of availment of incentives based on the combination of both location and industry priorities, as determined in the SIPP, shall be as follows:

For exporters:

For domestic market activities:

RBEs may continue to avail of the VAT zero-rating on local purchases and VAT exemption on importation under Section 294(E), and duty exemption on importation under Section 294(D), for the entire registration period as an RBE, reckoned from the date of registration, if the RBEs continue to meet the terms and conditions of their registration with their respective Investment Promotion Agencies and if the following requirements are met for the immediately preceding year:

(1) Registered export enterprises maintain at least seventy percent (70%) of total annual production or output as export sales;

(2) High-value domestic market enterprises satisfy the investment capital or export requirement under Section 293(J) of this Code. Qualified high-value domestic market enterprises may avail of the said incentives from the date of registration until the expiration of the income tax-based incentives granted in this section.

Registered domestic market enterprises may avail of duty exemption from the date of registration until the expiration of the income tax-based incentives granted in this section.

After the expiration of the entitlement to VAT zero-rating on local purchases and VAT exemption on importation under this Title, registered export enterprises may avail of the VAT zero-rating on local purchases and VAT exemption on importation under Sections 106, 108, and 109 of this Code: Provided, That they comply with the requirements set forth therein.

In addition to the incentives provided in the tiers above, projects or activities of registered business enterprises located in areas recovering from armed conflict or a major disaster, as determined by the Office of the President, shall be entitled to two (2) additional years of income tax-based incentives.

Projects or activities registered prior to the effectivity of this Act or under the incentive system provided herein that completely relocate from the National Capital Region, within the duration of their incentives, shall be entitled to three (3) additional years of income tax-based incentives: Provided, That the additional incentive shall commence upon the completion of the relocation of operations.