When the Philippine taxman comes knocking on online sellers’ doors

In yet another pandemic downer, the Philippines is 18% short of its tax target for the first five months of this year. It’s now issued a reminder to online sellers—the one industry to see an uptick—to pony up taxes, or else...

As Covid-19 forced business closures across the Philippines, tax collections have plunged by 25%

But internet purchases, especially of essentials, have seen a 30% rise across the region, with consumers avoiding face-to-face interactions

To plug the collection gap, the Philippine tax bureau has ordered online sellers to register their businesses and file taxes

Enforcement can be a huge challenge though—more so for social platforms like Facebook where payments do not pass through

When the Philippines went under a lockdown in March to combat the spread of Covid-19, many shoppers shifted to buying online. Sellers saw an opportunity. Chriz Valdez went from selling rice and fresh produce on her Facebook page “Murang Gulay Atbp” to also selling on grocery delivery service GrabMart GrabMart GrabMart Grocery delivery is the latest service launched by ride-hailing giant Grab in the Philippines, amidst the devastating pandemic and e-commerce platform Lazada in April.

Today, her gross sales across platforms reach an average of Php 300,000 (US$6,080) per month as compared to Php 100,000 (US$2,025) when she sold only on Facebook.

AUTHOR

Jum Balea

Jum is a Manila-based reporter for The Ken, where she covers startups and business across Southeast Asia, with a focus on the Philippines. She previously was editor for Tech In Asia, and business editor for Philippine media companies Rappler and ABS-CBN.

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