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Philippines
Overview
Last reviewed - 13 September 2025The Philippines is strategically located off the southeastern coast of mainland Asia, with a flying time of four hours or less to most major Asian countries. Its strategic location allowed it to bridge Eastern and Western cultures, producing a rich history of Asian, European, and American influences. The Philippines has been counted as the third-largest English-speaking country in the world. The capital of the Philippines is Manila, and the currency is the Philippine peso (PHP).
The Philippines adheres to the principles of a democratic republican state with a presidential form of government. The 2022 Strategic Investment Priority Plan listed the priority investment areas under three tiers. Tier I includes all activities in the 2020 Investment Priorities Plan, unless listed under Tier II or III. Tier II includes green ecosystems, health-related activities, defense-related activities, industrial value-chain gaps, and food security related activities. Tier III includes research and development and activities adopting advanced digital production technologies of the fourth industrial revolution, highly technical manufacturing and production of innovative products and services, and establishment of innovation support facilities. The government continues to give tax incentives to investors that do business in the Philippines in these priority areas. 100% foreign ownership remains permissible in many areas of investment, although certain industries are subject to foreign ownership limitation.
The Philippine gross domestic product (GDP) posted a growth rate of 5.4% in the first half of 2025. The main contributors to the growth were wholesale and retail trade, repair of motor vehicles and motorcycles, 6.4 percent; financial and insurance activities, 7.2 percent; and manufacturing, 4.1 percent. All major economic sectors, namely: Agriculture, forestry, and fishing (AFF) posted growths of 2.2 percent, while the Industry, and Services posted positive growths of 4.5 percent, and 6.3 percent, respectively.
PwC in the Philippines
Isla Lipana & Co. is the Philippine member firm of the PwC global network. We have provided professional services in the Philippines for 103 years. Along with the other Philippine member firms of the PwC network (Cabrera and Company, PricewaterhouseCoopers Consulting Services Philippines Co. Ltd., and PricewaterhouseCoopers Business Services Philippines Co. Ltd.) and affiliate member firm PricewaterhouseCoopers Services (in Brunei Darussalam), we continue to deliver quality services to our clients through our main office in Makati City and our offices in the cities of Manila, Cebu, Iloilo, Davao, Bandar Seri Begawan and Pasig. We now have 52 partners and more than 2,500 professional and support staff.
Quick rates and dates
| Corporate income tax (CIT) rates | |
|---|---|
| Headline CIT rate (%) |
25 |
| Corporate income tax (CIT) due dates | |
|---|---|
| CIT return due date |
Quarterly return: Within 60 days from the close of each of the first three quarters. Annual return: On or before the 15th day of the fourth month following the close of the taxable year. |
| CIT final payment due date |
On the 15th day of the fourth month following the close of the taxable year. |
| CIT estimated payment due dates |
Quarterly instalments paid within 60 days after each quarter. |
| Personal income tax (PIT) rates | |
|---|---|
| Headline PIT rate (%) |
35 |
| Personal income tax (PIT) due dates | |
|---|---|
| PIT return due date |
15 April |
| PIT final payment due date |
15 April |
| PIT estimated payment due dates |
For employees, the Philippines follows the PAYE system, which is carried out by the local employer through the WHT mechanism. Under this system, it is the responsibility of the employer (local company) to withhold and remit taxes on the compensation of its employees on a monthly basis. Further, our tax regulations require an annualisation of income and WHTs to be performed at year end (December). |
| Value-added tax (VAT) rates | |
|---|---|
| Standard VAT rate (%) |
12 |
| Withholding tax (WHT) rates | |
|---|---|
| WHT rates (%) (Dividends/Interest/Royalties) |
Resident: 0 / 10, 15, or 20 / 20; Non-resident: 15 or 25 / 20 / 25 |
| Capital gains tax (CGT) rates | |
|---|---|
| Headline corporate capital gains tax rate (%) |
See the Philippines corporate tax summary for capital gain rates. |
| Headline individual capital gains tax rate (%) |
See the Philippines individual tax summary for capital gain rates. |
| Net wealth/worth tax rates | |
|---|---|
| Headline net wealth/worth tax rate (%) |
NA |
| Inheritance and gift tax rates | |
|---|---|
| Headline inheritance tax rate (%) |
There is no inheritance tax in the Philippines. However, an estate tax of 6% is imposed on the assets of the decedent taxpayer. |
| Headline gift tax rate (%) |
6 |
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