BIR will deduct 2 percent tax on bloggers starting March 1, 2014. The BIR made an official announcement and said they will be strict on collecting tax from bloggers and for those who will violate rules will have corresponding penalties according to law.
Noel Escalo of Ambient Digital Philippines in a recent email, said they will deduct a 2% withholding tax from independent online publishers’ earnings (advertising revenues) effective this month.
The message reads:
To comply with RMC 55-2013, we will be deducting 2% withholding taxes on all payments to publishers for payments starting 01 March 2014. We will issue form 2307 (Tax Credit Certificates) only for individuals, and juridical persons who have filed BIR form 2303 or Individual Tax Identification Numbers with us together with their Personal Information Sheet. Please cascade this information to all your publishers on the said update. You can browse on the link below for the details of the BIR Regulation.
In its revenue memorandum circular, the BIR restated the taxpayers’ obligations in relation to online business transactions.
The agency described online shopping or retailing, online intermediary service, online advertisement/classified ads, and online auction as the most common types of online business transactions in the Philippines.
BIR’s policies and guidelines as well as the obligations and duties and basic compliance of parties to different types of online transactions are stated in the attached circular.
As to the penalty for violators, the BIR says:
Any person engaged in internet commerce who fails to comply with applicable tax laws, rules and regulations shall be subject to the imposition of penalties provided for under the existing laws, rules, and regulations, in addition to the imposition of penalties pursuant to the applicable Section/s under Chapters II and IV, Title X of the National Internal Revenue Code of 1997, as amended.