This or that, VAT or not

THE drafting of implementing rules and regulations (IRR) becomes imperative after a law is enacted. The IRR's purpose is to establish guidelines that will facilitate compliance with the law and the realization of its objectives. A recurring challenge, however, is the presence of IRR provisions that may conflict with the underlying law or, in some cases, the absence of necessary regulations. This raises concerns and questions among interested parties regarding which set of guidelines should take precedence.

The IRR for the Corporate Recovery and Tax Incentives for Enterprises Act, also known as the Create Act (Republic Act 11534), was signed on June 21, 2021, roughly three months after the law took effect on April 11, 2021. Subsequently, amendments to the IRR have been introduced to address issues, including clarifications pertaining to policies governing the grant and administration of incentives for eligible enterprises.