The House of Representatives has approved on Tuesday, Sept. 21, a bill appending value-added tax (VAT) to digital and electronic transactions for goods and services.
Approved with 167 affirmative and six negative votes, House Bill No. 7425 seeks to require digital service providers (DSPs) to collect and remit VAT on transactions processed on their platform. It includes subscription-based entertainment apps, such as Netflix and Spotify.
The bill sets the tax rate at 12 percent, which, in turn, “may be shifted or passed on to the buyer, transferee or lessee of the goods and properties or services.”
According to Inquirer, the VAT also covers online advertisement spaces; online licensing of software, updates, and add-ons; west filters and firewalls; mobile applications; video games and online games; webcast and webinars; provision of digital content such as music, files, images, text and information; and other goods or services that can be delivered through the internet.
It also covers search engine services; social networks; internet-based telecommunication; online training such as the provision of distance learning, e-learning, online courses and webinars; online newspapers and journal subscription; ad payment processing services.
Meanwhile, the six members of Makabayan bloc who protested the passage of HB 7425 stressed that it would make life harder for the majority of the Filipinos who relied heavily on the internet as they grapple with the pandemic.
“Sa internet na lang idinadaan ang pagbili ng kanilang pangangailangan para lang makaiwas sa COVID-19 kahit dagdag gastusin ang delivery fee nito. Maging ang kanilang mga libangan ay nakakahon na lamang sa digital media platforms kagaya ng Netflix, Spotify, Youtube, at iWantTFC,” said Senior Deputy Minority Leader Carlos Isagani Zarate of Bayan Muna Partylist.
Asst. Minority Leader Arlene Brosas (Gabriela Partylist) added that the the 12 percent tax rate imposed by the bill is the highest digital in the ASEAN region.
“Why do we insist on imposing these regressive tax measures when we can increase the taxes on rich families and top corporations? The collective wealth of the 50 richest Filipinos grew 30% to P3.9 trillion despite the COVID-19 pandemic,” Brosas said.
HB 7425 will be transmitted to the Senate for its concurrence.
The post House approves bill imposing VAT on digital transactions appeared first on Speed Magazine.
Source: Speed Magazine PH
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