New VAT Guidelines: BIR Warns of Closure for Non-Compliant Digital Service Providers

• BIR has issued draft regulation imposing VAT on digital services
• Non-compliant DSPs may face closure or take-down orders
• DICT and NTC will implement take-down orders to block services of non-compliant DSPs
• Digital services broadly defined to include various internet-based services
• Government aims to collect 12% VAT on digital services regardless of physical presence in Philippines
• Draft regulation open for public consultation on November 12
• VAT will apply to both B2B and B2C transactions
• Nonresident DSPs required to register with BIR and may designate local representative
• Filipino companies must withhold 12% VAT on services for B2B transactions
• Nonresident DSPs must file and pay VAT for B2C transactions
• Educational services from accredited institutions and services to educational agencies exempt from VAT.

Source: bilyonaryo.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.

---

---