NEW rules on taxation of digitalized transactions are being proposed by OECD (Organization for Economic Co-operation and Development), and these rules will be game changing in international taxation. In this regard, our Tax Code imposes income tax only on Philippine-sourced income of foreign corporations and alien individuals. Domestic tax rules, however, may be modified by income tax treaties entered into between contracting states. Is has then been recognized worldwide that there is a need to redefine what is the nexus or tax rules for the digitalizing economy. The OECD proposals definitely target companies that are engaged with or directly selling to consumers.

Source: Manila Times November 13, 2019 17:57 UTC