Starting July 1, 2025, the Capital Markets Efficiency Promotion Act (CMEPA) officially takes effect. This new law modernizes the Philippine capital market by updating the way investment earnings are taxed. Here’s what this means for you.
What is CMEPA?
CMEPA (Republic Act No. 12214) was signed into law on May 29, 2025, by President Ferdinand Marcos Jr. It’s designed to:
- Simplify the tax regime on investment instruments.
- Encourage wider investor participation by reducing tax burdens; and
- Attract foreign and domestic capital into the Philippine financial system.
While not all tax incentives and exemptions originally proposed under earlier drafts made it into the final law, CMEPA remains a major step toward deepening the local capital market and making the Philippines a more attractive destination for long-term investments.
How Does CMEPA Affect You?
Starting July 1, 2025, new tax rules will apply to certain investments and deposit products. Key changes include:
- Uniform tax rates on capital market products, making treatment across investments more consistent.
- Standardized 20% final tax on most interest income, replacing various rates and exemptions.
- Simplified tax rules help align the Philippines with international tax practices for financial markets.
These changes aim to make the tax system simpler and clearer for investors.
What PBCOM Products Are Covered?
The following are affected by CMEPA:
-
Sure Earner Time Deposit
-
Dollar and Euro Savings Accounts
-
Dollar Time Deposits
Our Commitment
As your banking partner, PBCOM remains committed to supporting you through this transition. Our Business Managers are equipped to walk you through any questions or concerns you may have and help you make the most of the new opportunities this reform presents.
Learn More
Should you wish to learn more, please don’t hesitate to reach out to your Business Manager or visit your nearest PBCOM branch.
