BIR mandates 2% withholding tax remittance on electricity spot market sales
The Philippine Bureau of Internal Revenue has mandated that the Independent Electricity Market Operator must withhold a 2% tax on wholesale electricity spot market transactions. This policy aims to improve tax collection accountability and ensure proper recording of electricity sales.
Why it matters
This regulatory change impacts energy market participants and generation companies by altering cash flow and tax compliance procedures in the Philippines.
<p>The Bureau of Internal Revenue (BIR) has ordered the Independent Electricity Market Operator of the Philippines (IEMOP) to withhold, account for, and remit taxes for electricity transactions in the wholesale electricity spot market (WESM) to ensure that they are properly recorded. </p><p>Under Revenue Regulations (RR) No. 5-2026, IEMOP must deduct the 2% creditable withholding tax from gross remittances before paying generation companies and market participants. </p><p>"We want to make sure that taxes from electricity transactions actually reach the government and are properly recorded.
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