Metro Manila (CNN Philippines, April 21) — The Bureau of Internal Revenue (BIR) plans to impose a creditable withholding tax on gross remittances of online platform providers to their partner sellers.
Amid the booming e-commerce sector in the Philippines, the agency said in an advisory Thursday that it sees “a need for the BIR to take advantage of this opportunity to identify sellers of goods and services who are therefore obliged to declare their income resulting from these transactions for tax purposes.”
The BIR aims to amend the Revenue Regulations (RR) No. 2-98 as this does not cover income payments made by e-commerce platforms to their sellers or merchants.
It is proposing to impose a creditable withholding tax of 1% on one-half of the gross remittances of online platform providers to sellers.
If the e-commerce platform does not require business registration of sellers, the withholding tax would only be deducted and remitted if a single purchase of goods and services amounted to ₱10,000 and if the same buyer and seller have engaged in at least six transactions.
It defines gross remittance as “the total amount of the value of the goods or services sold and paid through the online platform facilities.”
The BIR said the term “online platform provider” would cover the following:
– marketplace platform
– food delivery platform or its combination
– platform for resort, hotel, motel, inn, and other similar
lodging accommodations
– travel or transportation platform
– payment/remittance platform, such as electronic wallet
– other services or product platforms
If implemented, online shopping giants Shopee and Lazada, food delivery provider Grab, and mobile wallets GCash and Maya would be among those covered by the new rule.
“The withholding tax imposed… shall be in addition to the existing withholding tax obligations being imposed on the online platform providers,” it said.
The BIR said stakeholders can submit their comments on this plan no later than May 2.
