Bureau of Internal Revenue (BIR) Commissioner Romeo Lumagui Jr. has addressed consumer concerns about potential price increases following the enactment of the 12% Value-Added Tax (VAT) on digital services, signed into law today by President Ferdinand Marcos Jr.
According to Lumagui, while there may be some increases in subscription fees, the hike is expected to be minimal.
He emphasized that the BIR has no authority to impose a price ceiling on such adjustments, leaving digital service providers to decide whether they will implement any price increases.
The government’s new 12% VAT on foreign digital services is designed to generate additional revenue to fund essential national projects.
Lumagui explained that this law will expand the BIR’s authority to collect taxes for the government, with an estimated revenue increase of P100 billion between 2025 and 2029.
He reassured the public that this measure does not impose new taxes on ordinary Filipinos but instead strengthens the government’s ability to collect taxes, especially from companies benefiting from Filipino consumption.
