Global Daily Tax News, Filipino Tax Reform Laws Sent For Presidential Signature, (Dec 28, 2023)

Filipino lawmakers have signed off on various tax reform laws, which have been sent to the President for signature.

The House of Representatives has now signed off on all 17 bills prioritized by the country's President in the State of the Nation Address. Namely, the House approved at third and final reading legislation on the excise tax on single-use plastics, the value-added tax on digital transactions, legislation for the rationalization of mining tax regime, and motor vehicle tax changes.

In addition, the House passed the Real Property Valuation and Assessment Reform Act, among other bills.

Earlier, the House and the Senate approved the Ease of Paying Taxes Act, which is also before the President for signature.

The Act provides for the creation of a new "medium taxpayer" classification. Procedures will be streamlined for small taxpayers and penalties will be lowered for micro and small enterprises.

Overseas Filipino workers are exempted in the Bill from filing income tax returns. Further, it provides that returns may be filed and taxes paid electronically or manually with any authorized agent bank, or revenue district office through a revenue collection officer or authorized tax software provider.

Further, taxpayers will be able to electronically or manually register, transfer, or cancel their registration without the need to pay the PHP500 annual registration fee.

The legislation further commits the tax agency to refund erroneously paid taxes within 180 days.

In the area of value-added tax, the legislation enables adoption of the accrual method for the sale of goods and services for VAT purposes, allows taxpayers to recover output VAT paid where a supply falls through, it enables taxpayers to evidence a transaction with only a VAT invoice, and provides for the automatic indexation of the VAT registration threshold.