Friday, March 1, 2024

House panel eyeing tax on foreign-based online sellers

As the demand for digital service providers continues to rise amid the Covid-19 pandemic, the House Committee on Ways and Means chaired Albay 4th district representative Joey Sarte Salceda held a briefing Monday, March 14, with the Bureau of Internal Revenue (BIR) on the taxation of online transactions of non-resident foreign corporations (NRFCs).

Screengrab shows (from left, top) Albay representative Joey Salceda, Google Philippines government affairs and public policy head Yves Gonzalez, BIR OIC-assistant commissioner for legal service Larry Barcelo, and Facebook Philippines public policy head Clare Amador

Salceda said that the additional income from taxing online transactions can help support the country’s economy and the government.

BIR OIC-assistant commissioner for legal service Larry Barcelo reported that the BIR already has several issuances on the preferential rate or tax exemption availed by NRFCs, including streamlining the procedures and documents for the availment of these benefits and providing guidance on the filing of requests, tax relief applications, and tax-sparing applications.

For her part, BIR OIC-assistant commissioner for collection service Clavelina Nacar cited that they were able to collect P206.67 billion from online content creators and transactions from 2017 to 2021.

Meanwhile, Facebook Philippines public policy head Clare Amador and Google Philippines government affairs and public policy head Yves Gonzalez expressed their support for the digital VAT proposed by Congress through House Bill 7425.

Prior to adjournment, Salceda said that a digital tax unit under the BIR may be necessary to cover mainly online transactions in order to also consolidate all undertakings, information, and representation.

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