There have been improvements in recent years to VAT revenue collection in the Philippines, but there are a considerable number of exemptions from the country’s 12% VAT rate.
After receiving funding from South Korea to investigate and adopt a CTC e-invoicing regime, the Philippines is expected to roll out a phased VAT control reform over the coming years.
In 2018, the Philippines launched the Tax Reform for Acceleration and Inclusion (TRAIN), which included several tax reform proposals.
The TRAIN proposals included the requirement for large taxable persons who were engaged in e-commerce or export to issue e-invoices, e-receipts and to report sales data to the country’s tax administration, the Bureau of Internal Revenue (BIR).
2018 – TRAIN law was introduced.
End of January 2022 – Pilot program environment was made available to eligible taxpayers to establish test connectivity and verify file formats.
April 2022 – Six pilot companies will test the system end-to-end by transmitting e-invoices to the EIS.
July 2022 – 100 pilot taxpayers, including the initial six will have to report all their invoicing data to the EIS through the new system.
Understand more about Philippines’ continuous transaction controls including when businesses need to comply, and how Sovos can help.
Do you need help ensuring your business stays compliant with the upcoming e-invoicing obligations in the Philippines?
Sovos already provides early adopters with a solution connected to the Philippines Tax Authority Platform and helps other taxpayers prepare for the extended rollout of the CTC e-reporting system.
Learn how Sovos’ solution for VAT compliance changes in the Philippines can help your business stay compliant.