Source: Official Twitter account of the House of Representatives @HouseofRepsPH

The House Committee on Ways and Means approved on Wednesday a bill that imposes the 12-percent value added tax (VAT) on digital transactions. 

The committee proposed amendments to several sections of the National Internal Revenue Code, including digital transactions among those covered by VAT.

Under the bill, VAT will be imposed on online transactions and electronic service providers, including streaming services like Spotify and Netflix.

Present at the committee meeting were Bureau of Internal Revenue Commissioner Caesar Dulay, Bureau of Customs Commissioner Rey Leonardo Guerrero, and representatives from companies such as Google, Netflix and Grab.

Finance Asst. Secretary Dakila Napao told lawmakers the bill could generate as much as P10 billion, with P9 billion from non-resident entities and P1 billion from local entities. 

AAMBIS-OWA party-list Rep. Sharon Garin said: “The objective is to level the playing field, na if you’re making profit from here, selling to Filipinos here, you should pay taxes here.”

Garin said the bill won’t target small-time online sellers but rather the digital service providers outside the country. 

Albay Rep. Joey Salcada proposed the taxation of digital services in May, calling these measures “Netflix tax” and “Lazada tax.” Jayziel Khim Budino