The Philippine government intends to clarify the taxation of cryptocurrencies by 2024 as part of an infrastructure bill.
The Philippine Department of the Treasury presented President Ferdinand Marcos Jr. and his administration with a plan for fiscal consolidation and resource mobilization for the country. It is aimed at paying off the public debt of 3.2 trillion Philippine pesos (about $61.2 billion), which has increased due to the pandemic. The department estimates that if the plan is implemented, the country will raise an average of 284 billion Philippine pesos ($5.4 billion) annually.
Philippine Finance Minister Carlos Dominguez III proposed introduce clarifications into the tax regime for various sectors of the economy. In particular, it was about taxes on carbon emissions, digital services and transactions with crypto-currencies. It is also proposed to postpone the reduction of personal income tax and exemption from VAT. Dominguez stressed that this still needs to be worked hard, but by 2024, after the approval of the government, the necessary amendments will be implemented. Currently, there is no tax base in the country regarding digital currencies – assets are only subject to capital gains tax when they are sold.
In addition, the government began to pay special attention to games on the principle of “play and earn” (Play-to-Earn, P2E). The Philippine Internal Revenue Service directive states that users must report their earnings from games such as Axie Infinity. The P2E industry has not gone unnoticed by the Anti-Money Laundering Commission (AMLC) of the Philippines and the Securities and Exchange Commission (SEC) of the Philippines. Previously, the SEC called on banks and financial institutions to watch for suspicious transactions that could be related to Axie Infinity and similar games that traders can use to make money.
Despite the concerns of local regulators, digital currencies are in great demand in the Philippines. Last week, UnionBank, one of the largest banks in the country, launched blockchain-based digital bonds.
Source: Bits
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