PH, VN investors say ‘shake ‘em off’ to taxes and tariffs in 2025

Southeast Asia’s startup scene is bound for a shakeup.

Last week, the bombshell news that eFishery – the Jakarta-based unicorn and startup darling – is undergoing an investigation due to alleged financial irregularities has the industry wondering what’s next for the region’s largest market.

The news came as Indonesian consumer startup brands adapt to a new economic reality at home: a dwindling middle class that’s squeezing their margins.

Image credit: Tech in Asia

Long dubbed as the region’s “next Indonesia,” the Philippines and Vietnam may finally get the investor attention long enjoyed by their more popular neighbor in 2025.

Investors in both countries have been optimistic even amid the tech winter. And while 2025 presents some opportunities, factors such as new taxes, data restrictions, and higher US tariffs could dim the rosy picture they envision for these markets.

Wrangling with new regulations

In October, the Philippine government imposed a 12% value added tax (VAT) on digital services provided by local and foreign companies.

Expected to come into effect by the first quarter of 2025, the tax will apply to companies offering digital services in the country that may not have local offices, clarifies Filbert Tsai, managing director of the consulting firm Equity Labs.

Cloud service providers and ad platforms like Google Ads and Meta Ads in the Philippines are expected to start charging VAT, affecting startups that heavily invest in software-as-a-service and digital marketing.

While Tsai does not think the new taxes will have an impact on startups’ profits, he says it can make a dent on their cashflows.

Tsai also believes startups will take advantage of the new tax regime to hike prices.

Manila, Philippines / Photo credit: Shutterstock

If delivery service platforms begin imposing VAT, it could put pressure on customers who order goods through these channels, according to Ryan Llamoso, co-founder and CEO of Kaya Founders-backed Tomo Coffee. Currently, about 30% of the tech-enabled coffee chain’s sales are driven by delivery services.

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