THE Bureau of Internal Revenue (BIR) is exploring technologies to help it monitor the digital economy, and has determined that it needs the power to shut down sites for a taxation campaign or a crackdown on other abuses to be effective.
“The first thing the Commissioner is doing is to look for the means to shut down websites… We need to be equipped with that kind of technology before we go after them,” BIR Assistant Commissioner Jethro M. Sabariaga told reporters last week.
Mr. Sabariaga noted the difficulty of generating revenue from the digital economy.
Last year, the digital economy was estimated at P2.08 trillion, equivalent to 9.4% of gross domestic product.
The BIR has said it is looking for ways to improve the tax compliance of social media influencers, noting inadequate levels of tax registration in that trade.
“We’re engaging (with) the social media influencers. We’re trying to win them over… the more you can (bring about) voluntary compliance, (the) better,” he said.
Under Revenue Memorandum Circular No. 97-2021, influencers are defined as “all taxpayers, individuals or corporations, receiving income, in cash or in kind, from any social media sites and platforms in exchange for services performed as bloggers, video bloggers or as influencers, in general, and from any other activities performed on such social media sites and platforms.”
The circular noted that influencers were liable to pay income tax and business tax, which can come in the form of percentage tax or value-added tax.
The BIR is also looking to start imposing a creditable withholding tax on partner-merchants of online platforms by December.
This year, the BIR aims to collect P2.64 trillion. It collects about 70% of government revenue.
BIR collections rose 7.25% year on year to P1.86 trillion in the nine months to September period, but missed the P1.93-trillion target for the period. — Luisa Maria Jacinta C. Jocson