Have a heart, BIR urged

Deferment of online selling tax pushed

The BIR’s directive that would tax online sellers is ill-timed and insensitive

Following the outrage generated by the proposal to put additional taxes on online sellers and retailers, Sen. Sherwin Gatchalian on Saturday appealed to the Bureau of Internal Revenue (BIR) to defer its plan, citing the economic impact of the coronavirus disease 2019 (COVID-19) on Filipinos just trying to make ends meet.

In a statement, Gatchalian said that the BIR’s directive that would tax online sellers is “ill-timed and insensitive.” “Timing is important in setting or raising taxes. It’s not right for the BIR to tax online sellers when most of them are just starting to get back on their feet because they lost jobs during the ECQ,” Gatchalian said.

Previously, the Philippine Statistics Authority (PSA) earlier this week revealed that unemployment rate in the country had soared to a record 17.7 percent during the coronavirus lockdown, translating to 7.3 million jobless Filipinos.

This comes after strict quarantine measures shuttered most businesses in Luzon and other parts of the country, as government kept millions indoors to prevent further spread of the virus.

“Because we need to maintain social distancing especially since a vaccine against COVID-19 has yet to be discovered, and we are encouraging people to use technology to shift to the digital economy,” Gatchalian said.

BIR circular

To recall, the BIR issued on 1 June Revenue Memorandum Circular 60-2020 stating that online merchants have until 31 July to register and pay taxes and the senator stressed that taxing online sellers might lead to increased prices of goods, with merchants passing on the additional cost to their customers.

Gatchalian warned that such move may undermine the growth of the country’s digital economy, valued in 2019 at around $7 billion in a Google and Temasek study- still the smallest in Southeast Asia, adding that the Philippines’ e-Commerce market accounts for just 1.6 percent of GDP.

The senator suggested that in place of additional taxation, the government should resolve “some of the key concerns of the e-Commerce industry such as lack of trust, improving Internet and logistics infrastructures, and lack of governing entity at the regional level that can fight cybercrime and settle cross-border disputes.”

Gatchalian, who authored the Internet Transactions Act which seeks “to make online transactions easier and faster” in hopes of boosting the country’s digital economy, echoed statements of his colleagues Senators Joel Villanueva and Risa Hontiveros in asking government to instead “impose a stringent crackdown on erring big time business establishments.”

“Before we impose new taxes on the digital economy, we should first think of ways on how we are going to develop this industry in order to provide more jobs and opportunities to all Filipinos. I believe premature taxation will only do harm than good to our growing digital economy,” he said.

Fake products

Meanwhile, a female online seller on Friday was arrested by operatives of the Northern Police District (NPD) for illegally selling fake chicken nuggets which she claimed to be a product of the Kentucky Fried Chicken (KFC) Philippines.

According to the authorities, the suspect identified as Larraine Sarmiento was doing her transactions through social media by posting the alleged fake products of KFC online.

The 39-year-old suspect was arrested at Petron Gas Station along Gov. Pascual Avenue, Barangay Nuigan, Malabon City following the complaint made by the KFC Philippines, themselves, represented by Mr. Genesis B. Aguilar, Security Specialist, Food Group Security.

To verify the complaint, the operatives immediately responded by purchasing the said fake KFC product from Sarmiento for the KFC Philippines to evaluate.

Following the verification and evaluation process, KFC Philippines stressed the products being sold by Sarmiento through online are not standard of the KFC Nuggets products.

KFC also confirmed that Sarmiento is not an authorized distributor or seller of the said products.

Confiscated from the suspect were 10 heat-sealed unlabeled plastic containing alleged fake KFC chicken nuggets and money worth P1,100.

Arrested suspect along with the confiscated items/evidences was brought to NPD special operations unit for documentation and disposition pending filing of appropriate charges in court.

Sarmiento will be facing charges for violation of Article 18 of R.A 7349 known as “The Consumer Act of the Philippines”; Violation of Section 33 par. C of RA 8792 known as” Electronic Commerce Act of 2000” and Article 154 (Fake/False Information) of the Revised Penal Code in relation to Section 6 of RA 10175 (Cybercrime Prevention Act of 2012).