Taxation in the Philippines

Taxation in the Philippines is controlled by the Bureau of Internal Revenue.

Income Tax

Individual

The income tax rate for individuals ranges from 5% to 32%.[1]

Corporate

The income tax rate for corporations is 30%.[1]

Business Taxes

Value-Added Tax (VAT)

Value added tax is a general consumption tax that requires a 12% additional tax on the sales price of goods and/or services by VAT-registered seller or seller required by law to be under the VAT system.[2] It is an indirect tax, which may be shifted or passed on to the buyer, transferee or lessee of goods, properties or services.[3]

Percentage Tax

Percentage tax is a business tax imposed on persons or entities/transactions:

1. Who sell or lease goods, properties or services in the course of trade or business and are exempt from value-added tax (VAT) under Section 109 (w) of the National Internal Revenue Code, as amended, whose gross annual sales and/or receipts do not exceed Php 1,919,500 and who are not VAT-registered; and

2. Engaged in businesses specified in Title V of the National Internal Revenue Code.[4][5]

Excise taxes

Excise taxes apply to goods manufactured or produced in the Philippines for domestic sales or consumption or for any other disposition and to things imported.[6]

References

  1. 1 2 Assessment Programs Division 1. "Income Tax".
  2. ↑ Valencia, E.G., & Roxas, G.F. (2013). Transfer and Business Taxation (6th ed.). Baguio City: Valencia Educational Supply.
  3. ↑ Assessment Programs Division 2. "Value-Added Tax".
  4. ↑ Assessment Programs Division 1. "Percentage Tax".
  5. ↑ "NATIONAL INTERNAL REVENUE CODE OF 1997 - CHAN ROBLES & ASSOCIATES LAW FIRM".
  6. ↑ "NATIONAL INTERNAL REVENUE CODE OF 1997 - CHAN ROBLES & ASSOCIATES LAW FIRM".
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