A network of digital advocates is rejecting the proposed imposition of 12% value added tax on digital service providers including online shopping platforms and streaming platforms such as Netflix.
Digital Pinoys National Campaigner Ronald Gustilo said that the 12% VAT on digital service providers will only burden the already overtaxed public.
“With people shifting to digital services due to the convenience and opportunities that it offers, the proponents of House Bill 4122 are taking away the advancements achieved by the rapid digitalization of consumer services.”
Gustilo said that online sellers and patrons of online shopping platforms will also be heavily affected by the digitax. He says that digitax will push back the opportunities presented by online selling, which has transformed into the main livelihood of many Filipino families.
“This proposed law may do more harm than good as it will have a chilling effect, especially on micro, small and medium businesses that maximize digital technology. It will heavily affect the government’s digitalization campaign for businesses. We may see lesser digital MSMEs if the proposal passes.”
Gustilo stressed that the government should focus more on its backlog of collectibles rather than imposing additional taxes on the people.
“The government should give ample focus on its collection backlog. The people are already overtaxed. There are bigger fishes that they can catch: they just have to look closely”
Gustilo pointed out that in 2019, the Bureau of Internal Revenue has P80 billion in uncollected taxes and they were only able to collect P13.8 billion since it imposed amnesty for tax delinquencies. In 2021, BIR was able to collect P3 Billion pesos in delinquent taxes.
“The funds that the government needs for its projects can be provided once the collection delinquencies has been addressed. We reiterate that the government should focus on uncollected taxes rather than burdening further the already overtaxed people. The people need reprieve, not additional taxes.”
Reference: Ronald Gustilo, Digital Pinoys National Campaigner