• Majority of its employees must be a resident of
Barangay Micro Business Enterprises the municipality where its place of business is
located
R.A. 1978 – Barangay Micro Business Enterprises Act of
• Principal activity consists of its application/ use
2002 (November 13,2002)
of a particular skill PECULIAR to the locality or of
RAW MATERIALS PREDOMINANTLY sourced
Objectives:
from the area
Hasten the country’s development by encouraging the • Its business operation is confined within the
formation and growth of BMBE’s territorial jurisdiction of the municipality or LGU
in which its principal place of business is located
o Rationalization of bureaucratic
restrictions Micro-Business
o Active intervention of government • Principal activity is PRIMARILY for LIVELIHOOD
especially in the local level as determined by the MSMED Council or DTI as
o Granting of free seminars, trainings, PRIORITY AREA for development or government
incentives, and benefits to generate assistance
much needed employment and alleviate • Not a branch, subsidiary, division, or office of a
property large-scale enterprise
• Its policies or business modus operandi are not
What is a BMBE? determined by a large-scale enterprise of by
persons who are not owners or employees of
• Engaged in production, processing, or manufacture
the enterprise
of products, including agro-processing, as well as
trading and services, with assets not more than Php
BMBE Service Exceptions/ Exclusion
3Million (not all assets are considered)
• Natural persons who are duly licensed by the
• Must be BARANGAY-BASED/MICRO BUSINESS in
government in connection with the exercise of
nature and scope
one’s profession
• Juridical persons engaged in consultancy,
Who can register?
advisory
Corporation
• Services essentially carried out through licensed
Partnership
professionals
Sole proprietorship
Cooperative
Fiscal Incentives
Association organized under PH Laws
• Exempted from income tax for income arising from
the operation of enterprise, but shall not apply to:
CHARACTERISTIC:
o Interest, royalties, prizes, and other winnings,
• Must be a micro business
cash and/or property dividends, CGT
• Must be barangay-based
o Share of an individual in the Net Distributable
• Total Assets must be less than Php 3M
Income after Tax of a taxable partnership
• Assets must be capital asset o Income from practice of profession
o Compensation
Assets: REAL OR PERSONAL, exclusive of the land on o All other forms of passive income or income not
which the particular business entity’s office, plant and effectively connected from the operations of the
equipment, are situated should be less than Php 3M. BMBE
Assets must be owned and used for the conduct of its
• Exemption from the coverage of the Minimum
business.
Wage Law (BMBE Employees will still receive the
same social security and health care benefits as
A Barangay-Based
other employee); They could receive less the
minimum wage requirements of BMBE
• Technology transfer, production, and management
training
• LGU’s are ENCOURAGED to either reduce the
amount of local taxes, fees, and charges impose or
exempt such
• The following entities shall be exempted from Gross
Receipt Tax on Interest, Commissions, and discounts
derived from loans (special credit windows to
BMBE):
• Landbank of the Philippines
• Development Bank of the Phil.
• People’s Credit and Finance Corporation
• Small Business Guarantee and Finance Corp
• GSIS and SS on loans exempted to their
respective member employees under the BMBE
Law
Filing
• File an ANNUAL INFORMATION RETURN
• Sworn statement of assets owned and/or used
in business
