Based on the data that was presented by the Bureau of Internal Revenue (BIR), the foregone taxes brought upon by the Corporate Recovery and Tax Incentives for Enterprises also known as the "CREATE" Act was expected lower than the past year.

As per the document that was obtained from the BIR, the CREATE law, which lowered the income taxes rates struck against micro, small and medium-sized businesses (MSMEs)and major companies; led to a P68 billion revenue loss for the year 2021.

The BIR's forfeited revenue was only about half of the P138.2 billion as forecasted by the Development Budget Coordination Committee a year ago.

The implementation of CREATE law that took effect in 2021 effectively decreased the Corporate Income Tax (CIT) for the MSMEs, especially for those who have total assets that are less than P100 million and a total net income that is under P5 million—from 30 percent to 20 percent.  

Moreover, due to the 25% rate down in the CIT and the gradual 1% reduction for each year (from 2023 up to 2027), large corporations enjoyed because of tax savings.

According to Former Finance Secretary Carlos G. Dominguez III, he uttered that CREATE was considered one of the “biggest economic stimulus programs in the country’s history that focused on supporting businesses to recover from the long-term impact of the pandemic.”

Based on the estimations of the Department of Finance for the year 2022, the CREATE law would cost the government an amount of P117.6 billion in revenue losses.

Nevertheless, the CREATE law incurred an amount of P44.9 billion in tax losses by the end of July which is equivalent to 38.2% of the DOF’s full-year forecast.

The CREATE act was known as part of the Comprehensive Tax Reform Program (CTRP) of former President Duterte and wishes to be continued by the succeeding administration which is the Marcos administration.

In addition, President Marcos wants Congress to establish an act about reform in real property valuation, and the Passive Income and Financial Intermediary Taxation Act (PIFITA); the two pending Comprehensive Tax Reform Programs.

The BIR previously stated that from 2018 till the end of July of this year, net collections from the tax packages under the CTRP reached P107.7 billion.

The break-down of the said amount is the following: the sin tax reform laws that boosted excise taxes on cigarettes, heated tobacco products, vapor products, and alcoholic drinks brought P120.4 billion to the BIR collection, while the tax reform acceleration and inclusion law (TRAIN) added P100,2 billion.

Furthermore, the CREATE Act induced a total amount of P112.9 billion in revenue losses since it was put into effect last year.