PH STOCK MARKET

President Ferdinand R. Marcos Jr. led a special bell-ringing ceremony at the Philippine Stock Exchange (PSE) Tower in Taguig City on Tuesday, July 1, 2025, to mark the effectivity of Republic Act (RA) 12214, also known as the Capital Markets Efficiency Promotion Act (CMEPA).

In his speech, President Marcos expressed confidence that CMEPA will usher in a “new era of economic dynamism, investor confidence, and sustainable growth.” He emphasized that the reform aims to democratize investment access and enhance the country’s financial competitiveness, benefiting not only wealthy individuals and professionals but also Filipinos aspiring to better financial security.

Signed into law in May 2025, RA No. 12214 notably reduces the stock transaction tax from 0.6 percent to 0.1 percent, aligning the Philippines with regional financial markets and aiming to encourage broader participation in the capital market. As an example, President Marcos cited that a first-time investor buying PHP10,000 worth of stock would now pay PHP10 in tax instead of PHP60.

The new law also eliminates the documentary stamp tax on mutual funds and unit investment trust funds (UITFs), which are commonly utilized by young professionals and middle-class savers. President Marcos highlighted that these adjustments lower barriers and open the market to more investors. Additionally, CMEPA introduces a uniform 20 percent final tax on interest income, intended to simplify compliance and create a more level playing field.

Regarding retirement security, President Marcos noted that CMEPA provides a 50 percent additional tax deduction to employers who match or exceed employee contributions to the Personal Equity and Retirement Account (PERA). This incentive is designed to encourage employers in assisting their workers in building long-term financial stability.

From the government’s perspective, President Marcos stated that the law removes certain exemptions for government-owned or controlled corporations (GOCCs), which aims to level the playing field.

Finally, President Marcos directed the Securities and Exchange Commission (SEC) to streamline its procedures, address bureaucratic bottlenecks, and reduce transaction costs to accelerate the impact of the reform. He urged all market participants and stakeholders to uphold transparency, fairness, and good governance.