Service providers need not pay LGU taxes, fees outside HQ’s | Inquirer Business
Effective Sept. 24

Service providers need not pay LGU taxes, fees outside HQ’s

/ 02:08 AM September 15, 2022

Service contractors that provide temporary or outsourced workers—including those in a work-from-home (WFH) arrangement—need to pay local government taxes based on the location of their head office instead of their clients’ premises.

This is stated in the Department of Finance’s (DOF) local finance circular (LFC) which will take effect on Sept. 24, which provides the guidelines on local business taxes, fees and charges imposed on service contractors. It states that contractors whose clients are located in towns and cities where the contractors do not maintain any office are not liable to pay mayor’s or business permit fee.

Mainly affected are business process outsourcing firms with employees on WFH arrangement.

Article continues after this advertisement

Before this LFC was issued, local government units (LGUs) would collect the mayor’s or business permit fee from such firms, including food delivery service firms that do not have any office there.

FEATURED STORIES

“We issued the circular to address the concerns [the DOF] has been receiving from taxpayers since 2015, specifically on the imposition of mayor’s or business permit fee on service contractors deploying temporary and outsourced personnel in the local government outside its principal office,” Finance Secretary Benjamin Diokno said.

However, the LGUs may impose occupation fees on those who are temporarily occupying posts that do not require government examination.

Your subscription could not be saved. Please try again.
Your subscription has been successful.

Subscribe to our daily newsletter

By providing an email address. I agree to the Terms of Use and acknowledge that I have read the Privacy Policy.

TAGS: bpos, DoF, hybrid (partly on-site; partly WFH) model, taxes

Your subscription could not be saved. Please try again.
Your subscription has been successful.

Subscribe to our newsletter!

By providing an email address. I agree to the Terms of Use and acknowledge that I have read the Privacy Policy.

© Copyright 1997-2024 INQUIRER.net | All Rights Reserved

This is an information message

We use cookies to enhance your experience. By continuing, you agree to our use of cookies. Learn more here.