In Republic Act 11534, also known as the Corporate Recovery and Tax Incentives for Enterprises (Create) Act, the minimum corporate income tax (MCIT) rate was reduced from two percent to one percent for the period July 1, 2020 to June 30, 2023. Accordingly, the MCIT rate shall revert to the old rate of two percent based on the gross income of the corporation effective July 1, 2023. In the computation of MCIT, the gross income shall be divided by 12 months to get the average monthly gross income and apply the rate of one percent for the period Jan. 1 to June 30, 2023, and two percent for the period July 1 to Dec. 31, 2023.
For ease of computation, taxpayers may use the rates below, depending on their taxable period ending:
7/31/2023 - 1.08 percent
8/31/2023 - 1.17 percent
9/30/2023 - 1.25 percent
10/31/2023 - 1.33 percent
11/30/2023 - 1.42 percent
12/31/2023 - 1.50 percent
1/31/2024 - 1.58 percent
2/29/2024 - 1.67 percent
3/31/2024 - 1.75 percent
4/30/2024 - 1.83 percent
5/31/2024 - 1.92 percent
6/30/2024 - 2.00 percent
Please be guided accordingly.
Source:
P&A Grant Thornton
Certified Public Accountants