FILIPINO users of streaming giant Netflix will have to pay higher subscription fees starting June, as the imposition of a 12 percent value-added tax (VAT) on foreign digital services takes effect.
On Tuesday, Netflix updated its new monthly rates for its four subscription plans: mobile, basic, standard, and premium. Beginning on June 1, Netflix users will have to pay the following monthly rates:
- Mobile: P169 from P149
- Basic: P279 from P249
- Standard: P449 from P399
- Premium: P619 from P549
Standard plan subscribers may add one extra member who does not live with them for P169 per month, while Premium plan users may add up to two extra member slots for P169 each per month. This is a P20 increase from the current P149 per month for each additional member.
This comes after President Ferdinand “Bongbong” Marcos Jr. signed into law the Republic Act (RA) 12023 in October 2024, imposing a 12 percent VAT on foreign digital services, including digital media, digital music, digital video games, video-on-demand, and digital advertising.
This means that the law also covers digital platforms like Spotify, Amazon, Disney+, Shopee, Lazada, and Shein, which most Gen Zs access today for entertainment and their needs.
“We are not imposing new taxes, we are simply strengthening the authority and streamlining the process of the BIR [Bureau of Internal Revenue] to collect value-added tax on digital services,” the chief executive stressed.
The law, however, exempts digital educational services, like online courses and webinars, offered by private institutions and the sale of online subscription-based services to educational institutions, including the Department of Education (DepEd), the Commission on Higher Education (CHED), and state universities and colleges.
In March, game distribution company Steam announced that it would add VAT to its prices in the Philippines starting June 1.
This earned mixed reactions from Filipino Gen Z gamers, with some expressing concerns that the increased prices of Steam’s products could drive other gamers toward piracy. Others told republicasia that they would just wait for the games to be sold at discounted prices.
