![]() ![]() The BIR is also working hand-in-hand with KOICA to conduct feasibility studies for the project. According to reports, the government is expected to receive a grant from the Korea International Cooperation Agency (KOICA) to fund the initial phase of the invoicing project, which includes pilot testing. Guided by best practices in e-invoicing, the BIR started studying South Korea’s electronic invoicing system as early as January 2018. In the case of Thailand, a regulation was passed in 2012, allowing some companies to issue electronic tax invoices. Under the South Korean program, the taxpayers’ diverse circumstances are clearly considered by providing several options of invoicing that would facilitate efficient implementation in their respective businesses.Įlsewhere in the ASEAN region, Indonesia, Malaysia, and Brunei have implemented e-invoicing systems. All tax invoices are then required to be transmitted to the tax authorities immediately after issuance. Those who do not have online access have the option either to use the automatic response system (ARS) by telephone or to visit their local tax office for the issue of electronic e-invoices. As an alternative, the South Korean government provides and maintains a web application that taxpayers can use for free to issue and to email e-tax invoices to their customers. To issue and transmit invoices, a taxpayer may use an Application System Provider set up at the taxpayer’s expense. Since 2011, South Korea has been implementing its mandatory electronic tax invoice system for all corporate and certain individual taxpayers. ![]() Dominguez III cited South Korea’s electronic invoicing program as the best model on which to base the government’s own program. Spearheading the government’s new-found commitment towards digitalization, Finance Secretary Carlos G. Hand in hand with these practices that focus on physical records, policies and procedures on proper handling of and reliance upon fully digitized records and systems remain inadequate. For instance, in the case of VAT refunds, the BIR continues to stamp the invoices as proof of the claims for refund and in tax audits, BIR examiners rely only on printed copies to examine the taxpayer’s compliance with tax rules and regulations. One of the main reasons why the Philippines has lagged far behind other countries in implementing e-invoicing is the government’s continued reliance on physical documentation or usage of hard copies. Notwithstanding these regulations and statutory issuances, e-invoicing remains underutilized in the country not only by local businesses but also by multinationals which have long adopted these systems in their offices overseas. Pursuant to these regulations, taxpayers who wish to employ an electronic invoicing system are required to secure a Permit to Adopt CAS from the BIR. Under the circular, e-invoicing is a “system developed and maintained by the e-Buyer or e-seller, or both, in issuing an invoice electronically through the Internet. Subsequent to this, Revenue Memorandum Circular (RMC) 71-03 was issued where the BIR defined as well as what constitutes an e-invoice. As a directive, the RMO required taxpayers utilizing the e-invoicing system to apply for a complete Computerized Accounting System (CAS) which should be capable of generating hard copies of the invoices anytime. In 2002, the BIR acknowledged the acceptability of e-invoicing when it issued Revenue Memorandum Order (RMO) 29-02. Electronic invoices, therefore, are functional equivalents of paper invoices and should be acceptable for the purpose of evidencing sale transactions. In our country, the Electronic Commerce Act, passed in 2000, recognizes electronic documents as functional equivalents of paper documents and grants them the same legal effects as paper documents. Many developed countries had long before incorporated e-invoicing in their reportorial and tax compliance requirements. Though perhaps unfamiliar to many taxpayers, the concept of e-invoicing is not new in the country or elsewhere around the world. This measure is contingent on the establishment of a system capable of storing and processing the required data. ![]() Under the law, taxpayers engaged in the export of goods and services, e-commerce, and those considered Large Taxpayers, are required to issue electronic invoices/receipts and to report their sales data to the Bureau of Internal Revenue (BIR) at the point of sale within five years from the effectivity of the TRAIN law, i.e., on or before 1 January 2023. ![]() One of the major changes introduced in the TRAIN law was mandatory e-invoicing. ![]()
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