- Introduction of VAT for Foreign Providers: On October 2, 2024, the President of the Philippines signed a bill that mandates VAT liability for foreign providers of digital services to customers residing in the country. This law aims to increase state budget revenues by ensuring foreign providers register and collect local VAT.
- Implementation Timeline: The law will become effective approximately 15 days after its publication in the Official Gazette. Implementing regulations and rules are expected within 90 days, with the full system operational by spring next year.
- Business Impact: The law requires non-resident providers of digital services and intangible goods to register and collect VAT if their turnover surpasses the statutory threshold. This aims to level the playing field between domestic and foreign businesses and will significantly impact the e-commerce market in the Philippines.
Source 1stopvat
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