Go backs barter, other forms of regulated product exchange

Published July 17, 2020, 3:10 PM

by Mario Casayuran

Senator Christopher Lawrence “Bong” Go today urged the Department of Trade and Industry (DTI) to come up with alternative modes and platforms where individuals can conduct exchange of goods as long as these are legal and beneficial to the people.

Senator Christopher Lawrence “Bong” Go (Facebook / MANILA BULLETIN)

This developed after many Filipinos turned to the barter system to exchange personal items for food and other essentials amid economic hardships caused by the months-long coronavirus disease (COVID-19) pandemic.

“Hindi po illegal ang barter kapag ito ay personal transactions, ayon sa DTI. I am also encouraging the government to promote alternative modes of personal transactions to ease the burden of our fellow Filipinos as long as it is legal and beneficial to the people,” Go said. (Barter is not illegal if it is for personal transactions, according to the DTI.)

“Gawin po nating klaro sa ating mga mamamayan ang guidelines para di po sila malito at magkamali. Magbayanihan po tayong lahat at suportahan ang mga alternatibong paraan ng transaksyon na makakagaan sa pasakit na dulot ng krisis sa taumbayan,’’ he explained. (Let’s make the guidelines clear to our countrymen to avoid confusion and mistakes. Let’s help one another and support the alternative modes of transaction that will ease the burden of the people caused by the crisis.)

As the COVID-induced community quarantine lockdown is on its fourth month, several Filipinos turned to social media to conduct barter trading, one of the world’s oldest forms of trade conducted by exchanging goods and services without money involved. 

The trading of used gadgets for food, produce or school supplies is among the examples that fall under ‘personal transactions’ which are legal and exempted from tax so long as they are not conducted as a business. 

As for local barter trade done in the course of business, DTI Secretary Ramon Lopez emphasized that these are subject to regulations.

Lopez added that these business transactions must be registered and are subject to tax. He also mentioned that this might also apply to online transactions.

Under the law, any kind of business transactions, online or otherwise, must be registered and are subject to taxes. In the case of barter, when done as a form of business, value-added taxes are charged to businesses and individuals engaging in such practice.

Barters with yearly gross sales of P3 million, however, are exempted from paying value-added tax (VAT), Lopez said. He also pointed out that it is safer to buy goods from registered sellers because the buyers can turn to DTI in case of defective products.

At present, barter trade is only allowed in three areas in the country: Siasi and Jolo towns in Sulu, and Bonggao in Tawi-Tawi, as provided for by Executive Order 64 signed by President Rodrigo Duterte in October 2018.

The EO prescribed barter trade in these towns under the supervision of the Mindanao Barter Council.

“Outside those areas, barter trading across borders is not allowed. This is what I meant as illegal if done in other areas, or if done online and cross border as a regular business,” Lopez said.

In social media, online barter communities have emerged, such as in Bacolod and Cebu, where transactions have increased due to the community quarantine.

Go, chairman of the Senate health and demography committee, said that so long as existing laws are complied with, he supports various alternative forms of personal transactions or product exchange.

As to those conducting these transactions as a business, he advised them to make sure regulations are followed in accordance with the law. 

“Wala kaming problema sa businesses basta legal. Susuportahan ko po iyan, maliit man o malaki. Ang importante ay makakatulong ito sa tao at nasusunod ang batas,’’ he said. (We have no problem with businesses as long as they’re legal. I will support it, small or big. What is important is that this will help the people and it follows the law.)