The Government of the Republic of the Philippines has implemented a liberal program of fiscal and non-fiscal incentives to attract foreign capital and technology that complement local resources. Under the Omnibus Investments Code of 1987 (Executive Order 226), investors may enjoy certain incentives when investments are made in preferred areas found in the current Investment Priorities Plan (IPP).

Issued by the Philippine Board of Investments (BOI) annually, the IPP is a list of priority investment areas eligible for tax incentives in consultation with related government agencies and the private sector. Even if the activity is not listed in the IPP, an enterprise may still be entitled to incentives as long as at least 50% of production is for export (in the case of Filipino-owned enterprises), or at least 70% of production is for export (if majority foreign-owned enterprises or those with more than 40% foreign equity). In certain instances, as indicated in the IPP, the BOI may completely or partially limit the incentives available to export products.

Under Book I of the Omnibus Investments Code, BOI-registered enterprises are given incentives in the form of tax exemptions and concessions, as follows:

• Income tax holiday – exemption from corporate income tax for four years (non-pioneer projects) or six years (pioneer projects)
• Duty-free importation of capital equipment
• Additional deduction for labor expense equivalent to 50% of the wages of additional skilled and unskilled workforce
• Tax and duty-free importation of breeding stocks and genetic materials
• Tax credit on domestic breeding stocks and genetic materials
• Simplified customs procedures for the importation of equipment, spare parts, raw materials and supplies/exports of processed products
• Unrestricted use of consigned equipment
• Employment of foreign nationals in supervisory, technical or advisory positions
• Exemption from taxes and duties on imported spare parts