Tolentino Proposes Bill to Exempt Electricity and Internet from VAT

In a move to alleviate financial pressures on Filipino families and businesses, Senate Majority Leader Francis Tolentino has introduced a bill to eliminate the 12% value-added tax on electricity and internet services. The proposal, Senate Bill No. 2970, was filed on January 31, 2025, and aims to reduce the high cost of electricity in the Philippines, which is among the highest in the region. Tolentino highlighted that excessive electricity costs could hinder economic growth and potentially lead to deindustrialization. Additionally, he emphasized that removing the VAT on internet services would boost digital inclusion and enhance the Philippines’ role in the global digital economy. With the increasing reliance on online learning and remote work, Tolentino stressed the critical need for affordable and reliable electricity and internet. The bill seeks to amend Section 108 of the National Internal Revenue Code of 1997, exempting electricity sales by generation, transmission, and distribution companies, services by electric utility franchisees, and internet services from VAT. Tolentino stated that this initiative is crucial for ensuring all Filipinos have access to essential services in a digital age and is a direct response to the rising cost of living, aiming to provide significant financial relief to consumers.