MANILA - Personal transactions done outside the scope of trade and business are not subject to tax, Trade Secretary Ramon Lopez said Wednesday.
"DTI would like to clarify that personal transactions not in the course of trade and business are not covered by registration requirements, and is therefore, not subject to tax," Lopez said in a statement.
Meanwhile, there is no clear prohibition for local barter trade for businesses, including online transactions, but they are subject to regulation and must be registered, Lopez said.
Transactions with under P3 million gross sales per year can avail of value added tax exemptions, he said
Lopez clarified that he was pertaining to an executive order allowing barter trade in Siasi and Jolo in Sulu and Bongao in Tawi-Tawi when he said the practice was illegal. Outside those areas "it is not allowed," he said.
"This is what I meant as illegal—those done in other areas or if done online and cross border, or as a regular business in the course of trade—as these are not registered and not taxed, " he said.
The Trade chief earlier said online barter trade was illegal as it encouraged online sellers to register with the department and with the Bureau of Internal Revenue.
In barter trade, participants in a transaction directly exchange goods or services for other goods or services without using money. This practice has gained traction during the quarantine.