12% VAT sa online shopping, streaming at iba pa na hatid sa PHL ng foreign companies,... | 24 Oras

Summary

The Philippine government has passed a law imposing a 12% VAT on digital services, including online shopping, streaming, and cloud services, even for companies based abroad. Signed by President Bongbong Marcos, the VAT aims to align with existing local taxes on digital services. While users are concerned about potential price increases, the decision will ultimately depend on service providers. The government expects to collect billions in revenue over five years, funding projects like classrooms and health units. Exemptions include educational services such as online courses and webinars.

Takeaways

• 📜 A new law imposing a 12% VAT on digital services like online shopping and video streaming has been signed.
• 🛒 Online shoppers like Patrick and online video viewers like Mang Ramon may see potential price increases due to the new tax.
• 👨‍⚖️ The VAT law was authored by Senator Pia Cayetano, Senator Win Gatchalian, and Congressman Joey Salceda.
• 🌐 The law applies a 12% VAT to foreign digital service providers, such as streaming platforms, online marketplaces, and cloud services.
• 💻 The VAT already applies to local digital services, but this law extends it to foreign-based companies operating in the Philippines.
• 📊 A study shows that 50% of Filipino internet users shop online weekly, while 30% pay for TV and movie streaming services.
• 🎥 Almost all Filipino internet users watch online videos, many of which are monetized through ads.
• 💰 The government expects to collect billions of pesos over the next five years, which will be used to fund education and health projects.
• 🏗️ The tax revenue could build 42,000 classrooms, 6,000 rural health units, and 7,000 kilometers of farm-to-market roads.
• 💡 Educational services like online courses and webinars are exempt from the new VAT.

Q & A

What new law was signed regarding digital services in the Philippines?

A new law imposing a 12% Value Added Tax (VAT) on digital services, such as online shopping and streaming platforms, was signed into law by President Bongbong Marcos.

Who were the key authors of the VAT on digital services law?

The law was authored by Senator Pia Cayetano, Senator Win Gatchalian, and Congressman Joey Salceda.

Which digital services are now subject to the 12% VAT?

The VAT will be applied to digital service providers based outside the Philippines, including online streaming, digital goods, search engines, online marketplaces, and cloud services.

Will local digital services be affected by this new VAT?

No, local digital services have already been subject to VAT. The new law ensures that foreign digital service providers are also taxed.

What rationale did the President give for implementing the VAT on foreign digital services?

President Marcos stated that it is only fair for both small startups and global tech giants earning revenue in the Philippines to contribute taxes, whether they are based locally or abroad.

How frequently do Filipinos use online services, according to the study mentioned in the transcript?

Half of Filipino internet users shop online at least once a week, while 3 out of 10 pay for TV and movie streaming services.

What is the expected revenue that the government plans to collect from this tax in the next five years?

The government expects to collect billions of pesos from this tax over the next five years.

How will the collected revenue from the VAT on digital services be used?

The funds collected from this tax will be used to improve government services and support social welfare, including building classrooms and rural health units.

Will the 12% VAT automatically lead to price increases for consumers?

Not necessarily. Whether prices increase depends on the business decisions of the service providers. While price hikes are possible, they are expected to be minimal.

Are there any exemptions from the 12% VAT on digital services?

Yes, educational services such as online courses and webinars are exempt from the VAT under the new law.