Biz group backs govt’s plan to tax online sellers

MANILA  -The Federation of Philippine Industries (FPI) on Monday said it is backing the government’s plan to start collecting a 1-percent withholding tax from operators of online marketplaces before December this year, citing that the move will result in a fairer taxation policy for all businesses.

Jesus Arranza, chair of FPI, sees this planned move by the Bureau of Internal Revenue (BIR) closing the gap in the taxation of online businesses and physical stores.

“I am for taxing online purchases because it’s unfair to malls and stores, which put huge investments on mall structures, pay sales people, power, water, etc.,” Arranza said in a message sent to the Inquirer.

“It may not [level the playing field], but will close the gap to make it a little bit fair,” he added.

Arranza added that all businesses that earn income must be taxed, noting that the government should also implement an income bracket-based system.

Back in August, the Philippine Retailers Association (PRA) had also expressed support in taxing online sellers, saying that retailers in the virtual space in particular should be subject to the same tax laws applied to brick-and-mortar stores for there to have a level playing field.

“Matters such as taxation, duties, product standards, intellectual property, price tags, official receipts and truth in advertising—among others—must be upheld consistently across all online marketplaces,” Roberto Claudio, president of PRA, said during the 29th National Retail Conference and Expo at the SMX Convention Center in Pasay.

Late last month, BIR Assistant Commissioner Jethro Sabariaga told reporters that they were already assessing inputs from stakeholders on the final draft of a new revenue regulation covering online sellers. INQ