BPO tax exemption to stay

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The Department of Finance (DOF) said business process outsourcing (BPO) firms will retain their VAT exemptions and zero-rated status despite the implementation of the government’s Comprehensive Tax Reform Program. DOF Undersecretary Karl Kendrick Chua said the fear that the Philippine BPO industry will lose its competitiveness because of the proposed tax reform has no basis. He said there is no change in tax policy for exporters, including BPO companies. BPO firms in special economic zones will continue to enjoy VAT exemption while those outside the zone will retain their zero-rated status.

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