Two weeks after the resumption of session, HB 4122 or AN ACT IMPOSING VALUE-ADDED TAX ON DIGITAL TRANSACTIONS IN THE PHILIPPINES, AMENDING FOR THE PURPOSE SECTIONS 105, 108, 109, 110, 113, 114, 115, 236, AND 288 AND ADDING A NEW SECTION 105-A OF THE NATIONAL INTERNAL REVENUE CODE OF 1997, AS AMENDED, co-authored by our very own Cong. Teodorico “Nonong” T. Haresco passed the third and final reading.
HB 4122 aims to impose a 12% value-added tax to foreign digital service providers such as Spotify and Netflix. With the potential to raise P19B in revenue, the Philippines will finally be joining other ASEAN nations that tax non-resident digital service providers, should HB 4122 be enacted.
Cong. Haresco shared “Our own online entertainment and service providers are taxed but foreigners are not. We are essentially placing a disadvantage on our own people and unintentionally giving others an edge over us.”
“Dapat lang na pantay ang laban, umaabot na ng P110B or US1.9B ang estimated aggregate sales ng online media sector habang ang online market sales naman ay umaabot na ng USD17B in sum. Lugi ang mga malls, groceries at local manufacturers na nagbabayad ng VAT, samantalang ang mga foreigners naman, wala” Cong. Haresco added.
