Your Netflix might soon get taxed for COVID-19 efforts

Views
108

Per Inquirer, Albay Representative Joey Salceda is pushing for a tax on digital services, namely subscriptions on streaming apps, social media ads, and online sales platforms. Called the ‘Netflix’, ‘Facebook’, and ‘Lazada’ taxes, the levies will aid the government in lightening the financial blow of the COVID-19 pandemic.

Netflix, <b> Your Netflix might soon get taxed for COVID-19 efforts </b>
TechCrunch

The funds from the tax will reportedly offset an estimated P120 billion in foregone revenues once the government cuts corporate income taxes to 25 percent’.

Currently, subscription fees from apps such as Netflix and Spotify are not taxed by the national government. Salceda wants to impose a 12-percent tax, which is a tad bit higher than the worldwide standard of 5 percent.

For Facebook, the tax will be ‘based on how much companies earn from displaying the ads’. With Lazada, Salceda notes that only half of its vendors are paying Value Added Tax (VAT). With the proposal, online sale platforms will require a withholding tax from their suppliers.

Salceda estimates that VAT collections will amount to PHP 30 billion, given the growth of the Philippines’ e-commerce industry. For perspective, the National Economic and Development Authority (NEDA) estimates that the country is set to lose PHP 767.19 billion from the crisis.

 

Banner: TechCrunch