Philippines
Top Income Tax
35%
Marginal rate
Corporate Tax
25%
Standard rate
VAT / Sales Tax
12%
Standard rate
Capital Gains
15%
Standard rate
Overview
The Philippines offers a low cost of living with an English-speaking population. The tax system was reformed under the CREATE law with reduced corporate rates. Manila and Cebu have growing BPO and tech sectors. No formal digital nomad visa exists.
Income Tax Brackets
| Income Range (PHP) | Tax Rate |
|---|---|
| 0 - 250,000 | 0% |
| 250,000 - 400,000 | 15% |
| 400,000 - 800,000 | 20% |
| 800,000 - 2,000,000 | 25% |
| 2,000,000 - 8,000,000 | 30% |
| 8,000,000+ | 35% |
CREATE MORE Act reduced rates. 250k PHP tax-free threshold.
Corporate Tax
Standard Rate
25%
Small Business Rate
20%
20% for domestic companies with net taxable income under 5M PHP and total assets under 100M PHP.
VAT / Sales Tax
Standard Rate
12%
12% standard VAT on goods and services.
Capital Gains Tax
Standard Rate
15%
15% on net capital gains from sale of shares not traded on the stock exchange.
Social Security Contributions
Employee
5%
Employer
9.5%
Self-Employed
14%
SSS, PhilHealth, Pag-IBIG combined contributions.
Special Tax Regimes
PEZA (Philippine Economic Zone Authority)
Income tax holiday of 4-7 years followed by 5% gross income tax.
Eligibility: Must register as PEZA enterprise in designated economic zones.
Pros & Cons
Pros
- Low cost of living
- English-speaking country
- 250k PHP tax-free allowance
- PEZA incentives
- Young workforce
Cons
- 35% top income tax
- No digital nomad visa
- Infrastructure challenges
- Natural disaster risk
- Complex bureaucracy
Living Indicators
Cost of Living Index
Very affordable
Quality of Life Index
Average
Best For
Data Sources
Tax rate data for Philippines is compiled from the following authoritative sources:
- OECD Tax Database
- Tax Foundation International Tax Competitiveness Index
- World Bank Business Enabling Environment
- Philippines government tax authority publications
- PwC Worldwide Tax Summaries
Last verified: 2024-01
Disclaimer: This content is for informational purposes only and does not constitute tax advice. Tax laws change frequently. Always consult a qualified tax professional before making decisions about your tax residency or obligations.