The Department of Finance (DOF) wants to prohibit online sales of tobacco products and alcoholic beverages to curb underage smokers and drinkers as well as for tax compliance purposes.
Following the proliferation of merchants selling cigarettes and alcoholic drinks on e-commerce platforms, Finance Secretary Carlos G. Dominguez III said the government will impose a ban against the sale of liquors and cigarettes online.
“We will move to ban online sales of cigarettes and liquor,” Dominguez told reporters in a mobile phone message.
On Saturday, Dominguez said he called the attention of an e-commerce company operating in the country following a report that some of its accredited merchants were selling age restricted products, such as tobacco and liquor.
The government wants to impose a ban on online sales of sin products as internet transactions fail to implement the law-mandated identity verification for cigarettes and liquor purchases.
Dominguez also wants to check whether these cigarettes—usually sold online at discounted prices—have paid their taxes and are not counterfeit tobacco brands.
This latest move of the DOF comes in the wake of its campaign that requires online vendors to register with the Bureau of Internal Revenue (BIR).
But Dominguez assured online sellers that they will benefit from registering with the BIR as it puts them in the formal economy eligible to government assistance programs.
“Registering with the BIR not only help the government generate additional revenue for its various projects. Joining the formal economy also ensures that these businesses and their employees are eligible for government assistance programs,” Dominguez said.
In May, the BIR issued Revenue Memorandum Circular No. 60-2020, reminding everyone in the Philippines who are engaged in online selling to register with the tax agency.
Registration of online shops with the BIR would not burden small entrepreneurs, Dominguez said.
Citing the tax reform for acceleration and inclusion law, Dominguez said that small entrepreneurs earning less than P250,000 annually enjoy zero income tax, while their sales below P3 million are exempted from value-added tax. The finance chief also added that online sellers’ unpaid taxes for their unreported sales in the past will be waived once the proposed general tax amnesty, now pending in Congress, is passed into law.