Philippine exporters seek exemption from 12% tax on purchases

MANILA (Bloomberg): The Philippines’ largest exporter groups on Tuesday (March 21) urged the government to exempt their local purchases from a 12% value-added tax to help them offer competitive prices in the international market.

A tax regulation implemented in June 2021 began imposing a 12% VAT on sales transactions that were previously not taxed, including purchases of exporters. A month later, the country’s tax agency suspended that rule amid the pandemic and while it reviewed the regulation further.

The government’s Fiscal Incentives Review Board could come up with a final decision on the tax issue this month.

"Failure to address the VAT issue may have a crippling consequence on the parts localization initiatives of exporters and particularly affect their local suppliers who will be more at risk should they lose their market,” according to a joint statement from business-process outsourcing firms, electronics and garments exporters groups.

"As exporters, these three industries have claimed VAT zero-rating on their purchases consistent with existing local regulations and

The three industry groups generate annual combined revenues of about US$83 billion, accounting for around 69% of the Philippines’ goods and services exports and contribute 20% to the nation’s gross domestic product, they said.

Subscribe now to our Premium Plan for an ad-free and unlimited reading experience!

Philippines , VAT , taxes


Next In Aseanplus News

Woodcutter arrested for possession of revolver, bullets
Food aid cut may have dire impact on health of Rohingya Myanmar refugees, experts warn
Myanmar exports nearly 1.7 million tonnes of corn in nine months
Malaysia sets new Guinness World Record for largest gathering of people dressed as Spider-Man
Philippines' May y/y inflation 'definitely lower' than April's 6.6%, says its central bank chief
Health Minister apologises for Melaka Hospital lift breakdown, says already fixed
Ringgit to trade with upward bias versus US dollar next week; best level said to be at RM4.54
Families, rescuers search for victims of India's worst train crash in decades
Seized PIA aircraft finally lands in Islamabad after being grounded in Kuala Lumpur
Bursa Malaysia to remain below 1,400 points due to US, China concerns, say analysts

Others Also Read