Surprised? The Philippines Has the Highest VAT Rate in Southeast Asia

Surprised? The Philippines Has the Highest VAT Rate in Southeast Asia

Living in the Philippines has always been expensive, considering where it ranks on the economic ladder. So it comes as no surprise that Filipinos also bear the highest value-added tax (VAT) rate in the Association of Southeast Asian Nations (ASEAN), based on estimates by PricewaterhouseCoopers (PwC).

VAT is a sales tax that is described by the Bureau of Internal Revenue as one that is "levied on the sale, barter, exchange or lease of goods or properties and services in the Philippines and on importation of goods into the Philippines."

The Philippines' 12 percent VAT on goods and services ensures that the state has proper funding for public services. This means that citizens contribute to the national budget and the international standard for indirect taxation.

The State of Online Taxation One Year Into the BBM Administration, According to Taxumo

GUIDE: How to Claim Tax Refund at Singapore Changi Airport

The 10 Countries in the ASEAN With the Highest VAT Rates (Based on data from December 2023 to March 2024)

1| Philippines: 12 percent

2| Indonesia: 11 percent

3| Cambodia: 10 percent

4| Vietnam: 10 percent

5| Singapore: 9 percent (goods and services tax)

6| Thailand: 7 percent

7| Laos: 7 percent

8| Malaysia: 6 percent

9| Myanmar: 5 percent (service tax)

10| Timor-Leste: 2.5 percent (import sales tax)

The VAT rate in the Philippines has been at 12 percent since 2006. Before that, Filipinos only had 10 percent. RA 933710 RA 9337, or the Reformed VAT (RVAT) Law, amended the VAT Law in 2006.