Philippines levies 12% VAT tax on digital services by Amazon, Netflix and Disney

Philippines levies 12% VAT tax on digital services by Amazon, Netflix and Disney


Chesnot | Getty Images News | Getty Images

The Philippines will impose a 12% value-added tax on digital services offered by tech giants such as Amazon, Netflix, Disney, and Alphabet, in a move that will level the playing field with domestic brick and mortar players, the internal revenue agency said on Thursday.

President Ferdinand Marcos Jr signed into law on Wednesday the imposition of VAT on non-resident digital service providers such as streaming services and online search engines.

“This will promote fair competition amongst businesses that are profiting from consumers here in the Philippines. A level playing field produces better products and services,” Bureau of Internal Revenue Commissioner Romeo Lumagui said in a statement.

MNTN CEO on how streaming revenue strategies are changing

Only domestic digital service providers are now subject to paying the 12% VAT, the agency said.

Netflix does not have a statement to share at this time, a company spokesperson for Asia-Pacific said in an e-mail. Disney, Google and Amazon did not respond to requests for comment.

The government aims to collect 105 billion pesos ($1.9 billion) from the VAT between 2025 and 2029. It plans to allocate 5% of this revenue to fund projects for Philippine creative industries, the presidential communications office said.

The office added that educational and public interest services would be exempt from the VAT.

Digital services provided by foreign firms are considered rendered in the Philippines if the digital services are consumed in the Southeast Asian nation, the revenue agency said.

Since the pandemic, tech giants have experienced higher usage in Southeast Asia, but they also face increasingly stringent fiscal tax regimes.



Source

Longevity doctor: ‘Every single day I try to get at least 30 to 40 grams of fiber in my diet’—here’s how
World

Longevity doctor: ‘Every single day I try to get at least 30 to 40 grams of fiber in my diet’—here’s how

Poonam Desai is an ER doctor with two decades of experience who studied and recommended daily practices for a long life to her patients well before it became her main focus.  In 2017, she officially started practicing longevity medicine, teaching patients the tools they need to structure their routines with living long and staying healthy in […]

Read More
I’ve spent 10 years studying parents of highly successful kids—5 things they do differently: ‘It’s not just hard work and grit’
World

I’ve spent 10 years studying parents of highly successful kids—5 things they do differently: ‘It’s not just hard work and grit’

I’ve always been fascinated by families whose children seem to be on some kind of unusual streak, reaching the top of their career ladders, or, even more interesting to me, blazing trails or following their passions with spectacular results. What did their parents do differently to empower them? What do researchers really know about what’s […]

Read More
Morgan Stanley upgrades this mining stock as best pick to play rare earths
World

Morgan Stanley upgrades this mining stock as best pick to play rare earths

A wheel loader operator fills a truck with ore at the MP Materials rare earth mine in Mountain Pass, California, January 30, 2020. Steve Marcus | Reuters The rare-earth miner MP Materials will enjoy growing strategic value to the U.S., as geopolitical tensions with China make the supply of critical minerals more uncertain, according to […]

Read More