ONLINE SELLERS IN BAGUIO, LA TRINIDAD FIND BIR’S NEW MEASURE COMPLICATED, STRESSFUL

September 20, 2024 Metro BLISTT

BAGUIO CITY

A number of online sellers in the city and in La Trinidad, Benguet, described the Bureau of Internal Revenue’s (BIR) new rule, which requires all e commerce businesses to be registered, as complicated and stressful. In a random interviews, while they supports paying taxes, the new registration process is more time consuming. “It took me several days to complete processing my papers, and I needed assistance from an accountant to fully understand,” said an online seller who requested not to be identified.

While I respect and support proper documentation, I wish the process were more simpler. Based on BIR issued
Revenue Regulations 15-2024, effective Aug. 15, 2024, the internal revenue outlined the guidelines, procedures, and
requirements for the mandatory registration of businesses, including both physical retail establishments and online
businesses. The measure follows Republic Act 11967, or the Internet Transactions Act of 2023, which mandates that all individuals and entities engaged in online trade must comply with the laws and regulations of the countries
where their products are marketed.

Also, the BIR imposed a one-percent withholding tax on gross remittances made by electronic marketplace operators and digital financial services providers to online merchants and sellers.  Angela, a native handicrafts seller, a mother of three children ,who are in all in the elementary levels, told this writer that paperworks and costs top her concerns. Small seller tayo laeng , tapnu met adda paggatang ti school supplies dagiti anak ko, said Tig-iw,adding she support the government tax systen , but hearing others problematic with the new rule makes her hesitate to register.

Marjorie, operator of “ Kape Ti Cordillera ,” has seen completing her registration and described her experience stressful.  ”Nagpapa register ako …ngem stressful. Sobra iti strikto ti BIR kadagiti requirements.. addu ti papeles nga mai-submit ,’ she said. Online businesses are required to display an electronic copy of their BIR certificate of registration (COR) on their website, digital account, or platform, ensuring it is accessible and visible to customers.   Under the internal revenue guideline, operators of digital platforms and e marketplace platforms are also responsible for verifying that all their online sellers or merchants are registered with the BIR.

The agency has the authority to issue closure/take down orders for a minimum of five days to businesses that fail to comply with registration requirements. Penalties imposed include fines of P1,000 for late registration; P1,000 per business or store name for failure to register; P1,000 per business name for failure to post the COR on the business’s digital platform; P20,000 per establishment for operators of digital platforms that allow unregistered businesses to operate; P20,000 for failure to comply with a closure/take down order. 

ONE-PERCENT TAX 

For the one-percent tax, it applies to online sellers whose annual gross remittances exceed P500, 000. According to BIR, the tax is levied on one half of the gross remittances made by e-marketplace operators and digital financial services providers to online sellers. Online merchants whose annual total gross remittances do not exceed P500,000, or whose cumulative gross remittances in a taxable year have not yet exceeded this amount, are exempt from the tax.

Primo Agatep/ABN