House Committee approves 12% Value-Added Tax bill on Lazada, NetFlix

Long way to go

The House of Representatives is slowly moving towards taxing online services such as Lazada and Netflix as it approved, on the commitee level, a bill imposing value-added tax to digital transactions.

The said House Bill was earlier approved with the House Ways and Means Committee, which means it will now move into the whole House for three readings and approvals before being transmitted to the Senate for approval.

Last May, several policymakers have expressed their intention to tax digital services as another way to increase the government’s revenue amidst the COVID-19 pandemic. Albay Congressman Joey Salceda wants to push for new taxes on digital platforms such as “Netflix Tax”, “Facebook Ads Tax”, and “Lazada Tax”. In an Inquirer story, the Albay congressman noted that other countries have implemented taxes on these platforms with an average of 5%, with some countries like Chile going as high as 19%.

On the Senate side, Senator Bong Revilla has also filed a resolution seeking to explore how they can impose value-added taxes on these digital platforms. “We need to embrace the digital revolution of our time, and to comprehensively review and update our existing tax laws regarding the digital economy,” Revilla said.

We sought comments from Netflix last May, to which it responded no comment. More as we get it.

Carl writes for WalasTech when he's not working full-time. Give him tips and/or leads at [email protected].