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Last week, the Senate, in a unanimous vote, approved on third and final reading the Senate Bill (SB) No. 2528 that seeks to impose a 12% value-added tax (VAT) on digital services delivered by either resident or nonresident digital service providers with no physical presence in the Philippines.

In our earlier article, “Removal of the 5-Year Validity of Receipts and Invoices,” I explained that the Philippine tax system is mostly driven by supporting documents and that the deductibility of allowable expenses and claiming of input value-added tax (VAT) rely heavily on valid invoices.

One famous motto says, “Prevention is better than cure.” This saying is applicable to one’s everyday life. It is always better to avoid further damage than to be sorry about it in the future.

The passage of the Ease of Paying Taxes (EOPT) Act, or Republic Act No. 11976, sparked hope among taxpayers, envisioning a smoother journey in navigating tax-related complexities.

It is a well-settled doctrine that tax refunds are in the nature of tax exemptions and, hence, are construed strictissimi juris against the taxpayer.

According to estimates, the Philippines is losing ₱500 billion to tax evasion annually. Thus, even in the early stages of his term as the Commissioner of the Bureau of Internal Revenue (BIR), Commissioner Romeo Lumagui has implemented several reforms and programs against tax evaders.

In tax assessment, the Bureau of Internal Revenue (BIR) and the taxpayers will likewise protect and defend their duties and rights based on laws, rules and regulations, and jurisprudence.

The Philippine government has been proving this adage to be true, especially with the significant regulatory updates to Philippine taxation, with the most recent iteration being the Ease of Paying Taxes Law (EOPT Law).