President Ferdinand Marcos Jr., signed into law Republic Act 12023, a measure imposing a 12% value-added tax (VAT) on nonresident digital service providers.
“We are not imposing new taxes, we are simply strengthening the authority and streamlining the process of the BIR to collect value-added tax on digital services,” President Marcos said.
“This includes digital media, digital music, digital video, video-on-demand, and digital advertising. Local businesses and international digital platforms now compete on equal terms. We no longer will be playing by different sets of rules,” the President added.
The new law will impose taxes on the following: online market place, cloud services, online streaming and download media, and advertising.
The President also said that in the next five years, the government estimates to collect P105 billion from this measure.
“This is enough to build 42,000 classrooms, more than 6,000 rural health units, 7,000 kilometers of farm-to-market roads.” he said.
(Photo source: RTV Malacanang)
