Last September 03, 2025, the Bureau of Internal Revenue (BIR), through Revenue Regulations No. 23-2025, has issued updated policies and procedures governing the implementation of the tax subsidy granted by the Fiscal Incentives Review Board (FIRB) to the Armed Forces of the Philippines Commissary and Exchange Service (AFPCES). This move aims to streamline the administration of tax subsidies and ensure compliance with the provisions of the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act.
Under the updated guidelines, AFPCES is entitled to a tax subsidy covering its purchases of goods and services necessary for its operations. The subsidy is granted in lieu of actual tax exemption and is subject to FIRB approval. RR No. 23-2025 outlines the documentary requirements, validation procedures, and timelines for the processing of claims. It also emphasises the need for transparency and accountability in the utilisation of government subsidies. In line with this, the regulation requires stricter requirements as all claims must be supported by documentation, including purchase orders and official receipts, delivery and payment proofs, and certification of necessity for AFP operations.
The regulation mandates AFPCES to submit periodic reports detailing their purchases and corresponding tax amounts. These reports must be certified by the Commission on Audit (COA) and endorsed by the Department of National Defense (DND) before submission to the FIRB and BIR. Furthermore, the BIR is tasked with verifying the accuracy of the claims and issuing the corresponding tax subsidy certificates.
RR No. 23-2025 shall take effect 15 days following its publication on the Official Gazette or the BIR official website which will be on September 18, 2025. Please be guided accordingly.
Source:
P&A Grant Thornton
Certified Public Accountants
P&A Grant Thornton is the Philippine member firm of Grant Thornton International Ltd
As published in SunStar Cebu, dated 24 September 2025
