THE Bureau of Internal Revenue (BIR) has begun preparations for the possible implementation of a global minimum tax regime to ensure that large multinational companies pay a uniform rate on income generated in the Philippines.
In a statement on Thursday, the BIR said it had started groundwork for the proposed qualified domestic minimum top-up tax (QDMTT), a measure being pursued by the Department of Finance (DOF) as part of the country’s response to evolving international tax rules.
“As global tax rules evolve, we have to make sure that income earned in the Philippines remains taxable in the Philippines,” BIR chief Charlito Martin Mendoza said.
“At this stage, our immediate priority is to build the capability of our personnel and prepare the systems, processes, and organizational structures needed to administer the proposed regime effectively,” he added.
The move comes as governments worldwide adopt reforms designed to prevent multinational enterprises from shifting profits to low-tax jurisdictions and to ensure that large corporations pay a minimum effective tax rate regardless of where they operate.
Mendoza met on June 3 with the DOF’s QDMTT team and representatives from the Fiscal Incentives Review Board (FIRB) to discuss the key features and implementation framework of the draft Qualified Domestic Minimum Top-Up Tax of 2026 bill.
The discussions focused on tax administration requirements, including compliance procedures, reporting standards, audit readiness and the institutional capabilities needed.
The proposed QDMTT will allow the Philippines to collect any additional taxes needed to bring the effective rate paid by covered multinational enterprises up to the globally agreed minimum.
Mendoza said the BIR would continue coordinating closely with the DOF as preparations move forward.
The Department of Finance, for its part, said the proposed measure has been shaped partly by feedback from multinational companies operating in the country.
Finance Assistant Secretary Euvimil Nina Asuncion said many multinational enterprises had expressed a preference for complying with a domestic global minimum tax framework rather than deal with similar requirements imposed by tax authorities elsewhere.
“We have been informed that many of our multinationals would rather comply with the GMT domestically rather than comply with unfamiliar rules of other jurisdictions or pay top-up taxes abroad,” Asuncion said.
“The primary considerations are simplifying domestic compliance and ensuring that implementation is strictly in accordance with the international standards,” she added.
