The Bureau of Internal Revenue (BIR) said it will block online businesses that violate tax laws, especially with the expected increase in online sales during the holiday season.
In a statement, BIR Commissioner Romeo D. Lumagui Jr. warned online marketplaces, e-marketplaces, and online sellers that their online businesses could be blocked if they fail to register and pay taxes.
Lumagui said this move is part of the agency's efforts to ensure that all businesses, both online and offline, comply with tax regulations.
"If retail/physical stores are registered and paying their taxes, online stores should do the same," Lumagui said.
"In the coming months, we are expecting an increase in revenue of online businesses due to the holiday spending spree. To all consumers, ask online sellers/businesses for an official receipt. If you are spending your hard-earned income after paying taxes on their products, then online sellers/businesses should also pay their taxes,” he added.
The BIR's authority to block online businesses is provided under Section 115 of the National Internal Revenue Code, as amended by Republic Act No. 12023.
Lumagui said this provision empowers the BIR Commissioner to suspend business operations, including blocking digital services offered in the Philippines by a digital service provider.
Meanwhile, Lumagui expressed support for Republic Act No. 12066, also known as the Corporate Recovery and Tax Incentives for Enterprises to Maximize Opportunities for Reinvigorating the Economy (CREATE MORE) Act.
This law aims to make the Philippines a top investment destination by enhancing the country's fiscal regime.
"The BIR fully supports PBBM's thrust towards investments-led growth, through the CREATE MORE Act," Lumagui said. "It is time to make the Philippines into a prime investment destination. The BIR will implement the tax incentives under the CREATE MORE Act without delay. The BIR will also do its part in promoting the different incentives under the CREATE MORE Act, so we can educate and entice more investors."
The CREATE MORE Act amends the National Internal Revenue Code of the Philippines by improving tax incentives and streamlining related processes.
The BIR plans to conduct a public information campaign on the tax incentives granted by the CREATE MORE Act to promote the Philippines as a prime investment destination.