Philippines to Impose 12% VAT on Foreign Digital-Service Providers

By Sherry Qin

The Philippines will impose a 12% value-added tax on foreign digital-service providers such as Google and Amazon.com to level the playing field for both local and international players.

President Ferdinand Marcos Jr. on Wednesday signed a law imposing VAT on nonresident digital services, including search engines, online marketplaces and streaming, among others.

Bureau of Internal Revenue Commissioner Romeo Lumagui Jr. said at a briefing that the move will level the playing field in terms of tax collection among local and international digital-service providers, according to a release from the Presidential Communications Office.

"This is not a new tax, just to clarify, but a crucial step in ensuring fairness on competition in our rapidly evolving digital economy," said Lumagui, adding that only local providers were subject to the 12% VAT before the new law.

Write to Sherry Qin at sherry.qin@wsj.com

(END) Dow Jones Newswires

October 03, 2024 01:30 ET (05:30 GMT)

Copyright (c) 2024 Dow Jones & Company, Inc.