The Department of Finance (DOF) has reported that around 7 billion pesos has been collected from the new 12 percent value-added tax (VAT) on digital services. As per BusinessWorld, the Bureau of Internal Revenue (BIR) has collected PHP 6.57 billion since the law was imposed.
Affected parties include non-resident digital platforms operating in the Philippines like Lazada, Netflix, and Spotify. The largest amount collected was PHP 3.79 billion from withholding VAT on business-to-business (B2B) transactions as of September 25.
This figure was remitted by private withholding agents, with a small portion coming from government agencies. A month later, PHP 2.78 billion was collected from the non-resident digital service providers.
Analysts said the BIR is on track to meet their target number for this year amounting to PHP 10 billion. This figure was projected by former BIR Commissioner Romeo D. Lumagui, Jr.
The initial number was PHP 3.62 billion, with the number now well above the estimate. This is supported by rising technology spending and persisting compliance from the nonresident platforms.
In addition, the collection rate reflects more digital spending and improved monitoring of cross-border service providers. It was also noted that cashless payments and online transactions have aided the traceability of digital activities.
