Taxation in the Philippines
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|An aspect of fiscal policy|
Taxation in the Philippines is controlled by the Bureau of Internal Revenue.
The income tax rate for individuals ranges from 5% to 32%.
The income tax rate for corporations is 30%.
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. It is an indirect tax, which may be shifted or passed on to the buyer, transferee or lessee of goods, properties or services.
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
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.
- Valencia, E.G., & Roxas, G.F. (2013). Transfer and Business Taxation (6th ed.). Baguio City: Valencia Educational Supply.