- Philippines House Bill proposing VAT on foreign digital services gains Congressional approval
- Standard 12% VAT rate to apply to affected digital services
- Threshold level of PHP3,000,000 for gross sales in previous 12 months
- 180-day transition period for tax authority to establish implementation systems
- Estimated loss of PHP120 billion due to COVID-19 tax changes
- Passage of bill expected to raise P10 billion for Philippines Government
- Aim of bill is to capture value more fairly from foreign businesses
- East Asian countries losing tax revenue by not applying VAT rules to digital services
- Rapid growth of B2C e-commerce in East Asia leading to potential tax revenue growth
- Bill also focuses on sale of goods through marketplaces, mirroring global trend of taxing digital and physical goods
Source: vertexinc.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
