Businesses seek clearer cross-border tax rules

Businesses are calling for clearer and more consistent tax rules on cross-border services, warning that uncertainty in implementation can complicate compliance and affect investment decisions.

The issue took center stage at a policy dialogue on Revenue Memorandum Circular No. 5-2024 held 19 August at the Asian Institute of Management, where government officials, business groups, tax professionals and academe discussed how to translate the measure into workable requirements.

Convened by Arangkada Philippines with R.G. Manabat & Co. and SyCipLaw as co-presenters, the forum examined the implications of RMC No. 5-2024 for companies providing or receiving services across borders.

The circular affects areas including tax treatment, documentation, reporting, contracts and internal compliance systems. Participants stressed that consistent implementation would help companies better understand their obligations and provide greater certainty when structuring transactions.

Mary Karen E. Quizon-Sakkam, partner for tax at R.G. Manabat & Co., outlined developments surrounding the circular, while SyCipLaw Senior Partner and Head of Tax Carina C. Laforteza discussed its practical impact on businesses.

Representatives from the Bureau of Internal Revenue (BIR), Department of Finance (DoF), Presidential Legislative Liaison Office, Asian Institute of Management and other groups also took part in the discussion.

The Joint Foreign Chambers of the Philippines (JFC) said tax certainty remains an important factor in how companies plan operations, structure transactions and decide on investments.

Arangkada Project Director Matthew Scalin said stronger government-business engagement is needed to turn policy concerns into concrete improvements.

“Arangkada serves as a vital bridge between government and business, creating a platform where practical policy concerns can be openly discussed and translated into clear, actionable implementation that supports both compliance and competitiveness,” Scalin said.

Arangkada said it will consolidate the issues and recommendations raised during the dialogue and pursue follow-through with relevant government agencies and stakeholders.