‘It may be unpopular but we need to do this,’ Zubiri says on taxing online services

MANILA, Philippines – Senate  President Juan Miguel Zubiri on Tuesday vowed to come up with an E-Commerce Law that is not” abusive” but will generate revenue for the  government.

This, as  President Ferdinand “Bongbong” Marcos  Jr.  pitched in his first State of the Nation Address (Sona) on Monday the need to  impose the value added tax  (VAT) on  digital service providers.

Zubiri noted that the new  VAT on online services was mentioned  in the Sona while Marcos was talking  about the E-Commerce Law.

“I’d say, it may be unpopular but we need to do this,” he  said on ANC’s “Headstart.”

 Zubiri, however, pointed  out  that many other developed countries that  have an existing E-Commerce Law are now collecting  taxes from online  services.

 “So we have to plug (the leakage), as he said, plugging  the tax leakages and part of this  is the E-Commerce Law,” he said.

 “So were going to look at, I’m  coming   up with a nice E-Commerce law that will not be abusive  but at the same time gain revenue for government,” Zubiri  said.

He agreed with Marcos that the government is losing billions of pesos as many Filipinos  prefer  to buy online  now than go to  malls due to the pandemic.

According to Marcos,  the  government can generate P11.7 billion from VAT on  digital  service providers.  

 “Our tax system will be adjusted, in order to catch up with the rapid development of the digital economy, including the imposition of VAT on digital service providers,” the President said during his first Sona Monday afternoon.