I.

II.

Intensification of consumers security and suppliers accountability

In-depth the awareness to prevent fraudulent events to happen.
Understanding the treatment for foreign transactions.
Additional obligation for sellers causing them threats towards a decline in the business
activity.
Cause of additional burden for the sellers.
Declining in online business activity will occur.

The accountability of the seller and the security of the buyer upon these transactions are
compromised. These must be enough to promulgate a bill on the imposition of tax over the
online trades. Many fraudulent events happened when the growth of the idea of online shopping
expanded. Example of these frauds are non- delivery and fee stacking ( Dong, Shatz,
Xu,2011).To prevent this, ( Dela Pena, 2013), in her article wrote that the Philippine Bureau of
Internal Revenue commissioner Kim Henares provides for the requirement from each and one of
the online sellers to secure Authority to Print (ATP) invoices and register books of account either
manually or electronically. Through this provision, foreign or even local transaction occurring
after every trade through the World Wide Web will have its equivalent official receipt. The buyer,
on the other hand, will be able to put into its accounting books the occurrence of such event
stating and proving that the transaction has been actualized.
Another concern is that, when firms engaged in online selling are given the proportionate
tax, they will be required to register to the Department of Trade and Industry or Securities and
Exchange Commission. When the government puts attention to this, it will be easy to monitor the
retailers through the internet; thus, the growing number of these entities will be managed (Lee
U,2002).
When the online seller (individual or corporation) and the online buyer (individual or
corporation) are both physically present in the Philippines, there is apparently no issue as to
business and income tax liability since the income is clearly sourced within the Philippines (Lee
U, 2002, p.19). A question arises whether to tax those foreigners having online business
transaction or not, with the consideration that they have not established there businesses in the
country. On December 17, 2000, the BIR took side on such issue. Those foreign traders having
no warehouse for its businesses, or any related agenda on the online transaction it engages into,
shall not and will not be included in the Philippine Income tax. It is not to be considered
Philippine- sourced the fact that it never had its physical presence within the country.