Steam Purchases to Become More Expensive in the Philippines as 12% VAT Takes Effect

Well that sucks.

Filipino gamers will soon have to pay more for video games and in-game purchases on Steam as a 12 percent value-added tax (VAT) is set to be implemented starting June 1.

The tax will apply to all digital purchases, including full games, downloadable content (DLCs), and in-game transactions, with the final price automatically reflecting the added cost before purchase.

With this, a game priced at PHP1,000 will now cost PHP1,120, with the additional PHP120 covering the VAT. Steam, a PC gaming digital distribution platform giant, confirmed the change on its website.

The price hike follows the enactment of Republic Act 12023, also known as the VAT on Digital Services Law, which extends the country’s tax regulations to include digital transactions.

The bill was signed into law by President Ferdinand “Bongbong” Marcos Jr. on October 2, 2024 that sought to make amendments to the National Internal Revenue Code of 1997, ensuring that digital service providers—both local and foreign—are taxed similarly to traditional businesses.

The law covers various digital platforms offering media, entertainment, and online services. Aside from Steam, other affected services include Netflix, Spotify, Amazon, Disney+, and Lazada. (GFB)