BIR extends anew deadline for online trade registration to Sept. 30

Over 5,600 online-based businesses have complied with the extended deadline to register their operations with the Bureau of Internal Revenue (BIR), which on Tuesday (Sept. 1) further moved the cutoff date to Sept. 30.

As of Sept. 1, at least 5,650 online businesses already registered as taxpayers, Internal Revenue Deputy Commissioner Arnel S.D. Guballa told the Inquirer on Tuesday.

The original July 31 registration deadline had been moved to Aug. 31, but it fell on National Heroes’ Day, a regular national holiday, prompting the country’s biggest tax-collection agency to accept applications until Sept. 1.

But in Revenue Memorandum Circular (RMC) No. 92-2020 issued by Internal Revenue Caesar R. Dulay also on Tuesday, the BIR chief said he noted that there was “a surge of registrants in various revenue district offices that are trying to beat the deadline.”

“Considering this and the BIR’s resource constraints at this time of quarantine protocols due to the COVID-19 pandemic, the deadline is further extended to Sept. 30, 2020,” Dulay said.

Dulay gave an assurance that registration until the end of the month won’t be considered violation of the deadline which carries penalties.

“These taxpayers who have prior transactions subject to pertinent taxes are also encouraged to voluntarily declare the same and pay the taxes due thereon, with no penalty for late filing and late payment, provided the same is done on or before the extended due date,” Dulay added, referring to enterprises engaged in digital and online transactions.

But Dulay warned that those who willingly engaged in online business without registering or updating their registration and those who fail to declare and pay past taxes would face “penalties under the law.”

In June, Dulay issued RMC 60-2020 to remind online stores of their registration and tax obligations under the Tax Code as well as guidelines issued by then BIR chief Kim S. Jacinto-Henares in 2013.

Henares’ RMC 55-2013 required all online stores to register and pay taxes. These included online retailers, online malls, online market places, web stores and similar websites.

The government had found that online sales flourished as more enterprises did business on the internet, social media, and other digital channels at the height of the longest and most stringent COVID-19 lockdown in the region, which shut down many brick-and-mortar marketplaces.

Finance Secretary Carlos G. Dominguez III earlier said RMC 60-2020 was part of the government’s effort to implement a tax-collection program on digital transactions for goods and services, just like it collected taxes from physical stores.

“What we are asking right now is just for online sellers to register with the BIR. Whether or not they will be subject to tax depends on their specific circumstances,” according to Dominguez.

TSB