BIR can't say how much taxes online sellers had paid seven years since policy took effect

The Bureau of Internal Revenue (BIR) does not know how much taxes it collected from online businesses since it implemented a memorandum taxing online sellers seven years ago.

This was revealed during the House Committee on Ways and Means’ hearing on BIR’s June 2020 memorandum circular notifying "all persons doing business and earning income in any manner or form, specifically those who are into digital transactions through the use of any electronic platforms and media, and other digital means” to register to ensure that they are tax compliant. 

The same memo states that online sellers should register by July 31 or they would face penalties.

To recall, in August 2013, then-BIR commissioner Kim Henares issued Revenue Memorandum Circular 55-2013 reminding parties in online business transactions of their tax obligations and that any person engaged in internet commerce who fails to comply with applicable tax laws, rules and regulations will be penalized.

Asked by ACT party-list Representative France Castro on how much the BIR collected since the memo was implemented, BIR  Deputy Commissioner Arnel Guballa said, “Wala ho kasing industry code… kaya  wala kaming… hindi namin ma-capture sa aming data system kung how much yung nakolekta namin [since 2013].”

“As of now, we are working on it. Mano-mano ho kasi naming nire-retrieve pa iyong ilang….how much [ang] nakolekta namin from 2013 up to now regarding these online sellers. Kindly give us time to get the data po,” Guballa added.

Castro expressed disappointment over the BIR official’s response, saying that its move on strictly collecting taxes from online sellers amid the COVID-19 pandemic, when lockdown protocols to prevent virus transmission resulted in work stoppages and reduced incomes, is tantamount to punishing the public over BIR’s "negligence."

“I have to say this, with due respect sa BIR. Nakikita natin itong kapabayaan ng BIR. This is somehow a criminal negligence; itong ginawa niyo na hindi niyo napatupad ang memo ninyo,” Castro said.

“Ngayon, dahil nangangailangan tao ng pera para pang suporta sa tao ngayong pandemic, nagkukumahog kayo, minamadali niyo ang publiko sa gitna ng pandemic,” Castro added.

Castro said that the BIR should be able to furnish the committee with the amount of taxes collected from online sellers for the past seven years as soon as possible.

“Dapat may deadline sana tayo kung magkano nga itong amount na binabanggit ng BIR [na nakolekta nila sa online sellers],” Castro said.

The Palace and Finance department earlier said that online businesses who are earning P250,000 or less in a year need not pay taxes, meaning those small time online sellers should not fear paying taxes once they have their business registered with the Department of Trade and Industry. --KBK, GMA News