That is AI generated summarization, which can have errors. For context, all the time seek advice from the total article.
Digital monetary service suppliers like GCash and Maya have till October 12, 2024, earlier than they’re required to impose the withholding tax on on-line sellers utilizing their platform
MANILA, Philippines – On-line sellers or retailers on digital marketplaces like Shopee and Lazada ought to now be paying extra taxes which might be to be withheld by these e-commerce websites, based mostly on a Bureau of Inner Income (BIR) regulation that began July 15, Monday.
“Digital Market Operators will start imposing withholding tax towards their sellers/retailers beginning July 15, 2024. We now have already prolonged this by 90 days. No additional extensions will probably be given,” BIR Commissioner Romeo Lumagui mentioned in a press launch on Tuesday, July 16.
He clarified that “withholding tax just isn’t a brand new tax, it’s merely a system of taxation the place taxes are collected at supply, which will probably be credited towards the overall earnings tax legal responsibility of the sellers/retailers.”
“The BIR goals to stage the taking part in subject between brick-and-mortar shops, that are recurrently complying with their tax obligations, and on-line market locations. Whether or not their enterprise is operated on-line or by means of bodily shops, sellers and retailers must pay their taxes,” Lumagui added.
Rappler’s tax columnist Mon Abrea mentioned in an article final January that this isn’t a brand new tax.
“This isn’t but the digital tax. This withholding tax is in impact a sophisticated assortment of the earnings tax due from the sellers/retailers…,” he mentioned. You possibly can be taught extra about this right here: [Ask the Tax Whiz] Are on-line sellers/retailers required to pay taxes?)
In one other piece Abrea wrote in February, he mentioned: “As clarified by [BIR] Income Memorandum Round (RMC) No. 8-2024, on-line sellers or retailers are required to register and pay their taxes. Nevertheless, it’s the e-marketplace operators and/or the digital monetary service suppliers (DFSPs) that are required to withhold the 1% tax on gross remittances, and thereafter remit the identical to the BIR.”
In late 2023, the BIR issued Income Regulation 16-2023, imposing a 1% creditable withholding tax on half of the gross remittances by e-marketplace operators, equivalent to Shopee and Lazada, and digital monetary service suppliers (DFSPs), equivalent to GCash, to on-line retailers after their items and providers are bought by means of the platform.
The BIR had beforehand prolonged the implementation “in recognition of the compliance wanted with the relative insurance policies or necessities of different authorities companies and to offer the affected events a chance to regulate.” That extension has since handed, and the BIR confirmed that each one digital market operators at the moment are required to impose the withholding tax on sellers beginning July 15.
In the meantime, the BIR granted one other 90-day allowance for DFSPs like GCash and Maya to “full their respective system changes,” extending the prescribed transitory interval till October 12, 2024. – Rappler.com
