banner image
Tax Alert

Capital Markets Efficiency Promotion Act (CMEPA)

(Republic Act No. 12214 signed by the President on May 29, 2025 and published at the Manila Bulletin on June 4, 2025)

This Tax Alert is issued to inform all concerned on the amendments to the Tax Code introduced by Republic Act No. 12214 or the Capital Markets Efficiency Promotion Act (CMEPA).

The State, through CMEPA, endeavors to simplify an otherwise complex tax system for easy compliance; ensure that the taxation of passive income is equitable across all stakeholders and discourages arbitrage opportunities; promote the development and tax competitiveness of capital markets within the context of globalization, increased capital mobility, and financial inclusion; promote and incentivize investment in the trading of equity and debt securities; and aid the capacity of corporate entities to raise capital through capital markets. 

Below are the significant amendments to the National Internal Revenue Code (NIRC) as introduced by CMEPA:

Transitory Provision and Effectivity

Any tax exemption and preferential rate on financial instruments issued or transacted prior to July 1, 2025, shall be subject to the prevailing tax rate at the time of its issuance for the remaining maturity of the relevant agreement.

Republic Act No. 12214 shall take effect on July 1, 2025, following its complete publication in the Official Gazette or in at least one (1) newspaper of general circulation.

Copy text of article