BIR advises taxpayers to seek alternative ePAY solutions as GCash halts tax payments
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TAX & BUSINESS-RELATED NEWS [JUNE 5-12]
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BIR AMENDS THE VENUE FOR THE ISSUANCE OF TAX-FREE EXCHANGE TAX CLEARANCE
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BIR ADVISES TAXPAYERS TO SEEK ALTERNATIVE ePAY SOLUTIONS DUE TO NON-AVAILABILITY OF GCASH
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BIR REVOKES & INVALIDATES PREVIOUS BIR RULINGS STATING THAT CLARK DEVELOPMENT CORPORATION ENJOYS THE SAME PRIVILEGES AVAILABLE TO REGISTERED BUSINESS ENTERPRISES
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COURT OF TAX APPEALS CASES ON JURISDICTION OVER LGU FEES & MANDAMUS FILED ON THE AVAILMENT OF TAX AMNESTY
1. TAX & BUSINESS-RELATED NEWS [JUNE 5-12]
1. Appellate court affirms Petron’s canceled P64.33-million tax liabilities
2. Lower income taxes pushed
3. Commute no more: US employees embrace working from home
4. Makati claim on Bonifacio Global City dead – Taguig
5. DTI summons 2 big e-commerce platforms for ‘fraudulent sales practices’
6. Ramon Ang to pay 120% premium for more shares in SMC parent
7. Manila Bay casino developer seeks P25-B loan from China Bank
8. SPNEC to break ground on solar farm expansion in Nueva Ecija
9. BIR advises taxpayers to seek alternative ePAY solutions as GCash halts tax payments
10. Qualified Pinoys may travel to Canada visa-free
11. Bongbong Marcos promises improved tax administration
12. Philippines needs updated tax laws for the digital economy — PIDS
13. Dispute brews over ‘Eat Bulaga’ trademarks: IPOPHL
14. CTA: Comelec should pay over P1B in deficiency withholding tax
15. Lumagui urges new CPAs to uphold ethical standards amid ghost receipts scandal
16. AyalaLand to open Pampanga Technopark in Mabalacat City
17. Tax system being outmaneuvered by digital companies
2. BIR AMENDS THE VENUE FOR THE ISSUANCE OF TAX-FREE EXCHANGE TAX CLEARANCE
Revenue Memorandum Circular (RMC) No. 65-2023, issued on June 8, 2023, amends Item VIII of RMC No. 19-2022 on the venue for the issuance of Certificate Authorizing Registration (CAR) relative to tax-free exchanges of properties under Section 40(C)(2) of the 1997 Tax Code, as amended. As amended, it is the Revenue District Office (RDO)/Large Taxpayers (LT) Office having jurisdiction over the place where the transferee/surviving corporation is registered shall be the venue to process the submitted documentary requirements and issuance of CAR, regardless of the number of real properties and/or shares of stocks involved in a transaction, and regardless whether these properties are situated in various locations covered by different RDOs/LT Offices.
It may be recalled that with the passage of the Corporate Recovery and Tax Incentives for Enterprise Act (CREATE Law), a prior ruling is not necessary. However, as previously clarified in RMC No. 19-2022, it is the RDO having jurisdiction over the place where the property is located, in case of real property, or the RDO where the issuing corporation is registered, in case of shares of stocks, shall process the documentary requirements and issue CAR.
3. BIR ADVISES TAXPAYERS TO SEEK ALTERNATIVE ePAY SOLUTIONS DUE TO NON-AVAILABILITY OF GCASH
In a Tax Advisory dated June 2, 2023, the BIR has advised taxpayers to seek alternative ePAY Solutions due to high failure count for BIR payments via the GCash mobile application detected last May 24, 2023. Globe X-Change, Incorporated (GXI) decided to temporarily disable BIR payments acceptance to avoid further inconveniences both taxpayers and partner banks, while an investigation is being conducted.
4. BIR REVOKES & INVALIDATES PREVIOUS BIR RULINGS STATING THAT CLARK DEVELOPMENT CORPORATION ENJOYS THE SAME PRIVILEGES AVAILABLE TO REGISTERED BUSINESS ENTERPRISES
Revenue Memorandum Circular (RMC) No. 63-2023, issued on May 31, 2023, revokes, and invalidated BIR Ruling No. 038-2001 and 046-1995, which ruled that Clark Development Corporation (CDC) is considered as a business enterprise which is entitled to the same privileges available to Registered Business Enterprises (RBEs). As clarified, while it is true that CDC is a private corporation and performs activities that are proprietary in nature, the fact still remains that is a Government Owned and Controlled Corporation (GOCC) entrusted with the responsibility of carrying out regulatory functions. As such, it does not stand on equal footing with RBEs operating within the Clark Special Economic Zone (CSEZ), thereby precluding it from claiming the same privileges available to them. Consequently, its income shall be subject to the Regular Corporate Income Tax (RCIT). Likewise, it is not entitled to the same fiscal and non-fiscal incentives which are exclusively granted to RBEs. As further clarified, with the passage of the Corporate Recovery and Tax Incentives for Enterprise Act (CREATE Law), the CDC cannot be both an Investment Promotion Agency (IPA) and RBE since these are two separate and distinct entities with different purposes and functionalities.
5. CTA CASES ON JURISDICTION OVER LGU FEES & MANDAMUS FILED ON THE AVAILMENT OF TAX AMNESTY
SLAUGHTER FEES ARE NOT LOCAL TAXES BUT REGULATORY FEES, THUS, CTA HAS NO JURISDICTION
Petitioner San Miguel Foods, Inc. (SMFI) filed a Petition for Review seeking the reversal or modification of the CTA 1st Division’s earlier Decision and Resolution and praying to remand the case to the Court a quo for the resolution of the issues raised therein. The main issue is whether the Court has jurisdiction over regulatory fees imposed by the Local Government Unit (LGU) pursuant to its taxing authority under the Local Government Code (LGC) and whether the imposed fees should be considered a fee or a tax. In ruling, the Court explained the importance of classifying the local imposition to determine the issue of jurisdiction. If the primary purpose is revenue, then the imposition is properly classified as an exercise of the power to tax. On the other hand, if the purpose is primarily to regulate, then it is deemed an exercise of police power in the form of a fee, even though revenue is incidentally generated. Here, the Court finds that the Permit Fees to slaughter are, therefore, not local taxes and the Court a quo had already dismissed a similar and earlier Petition filed by the Petitioner for lack of jurisdiction. All told, the Court En Banc finds no reason to modify or reverse the assailed Decision and assailed Resolution of the Court a quo. Hence, the Petition was DENIED for lack of merit, and the earlier Decision and Resolution were AFFIRMED. [SAN MIGUEL FOODS, INC. VS. OFFICE OF THE CITY TREASURER, CITY OF DAVAO, CTA EN BANC CASE NO. 2535, MAY 18, 2023)
IT IS NECESSARY THAT THE CASE MUST BE CONSIDERED A “DELINQUENT ACCOUNT” TO AVAIL OF THE TAX AMNESTY
Petitioner St. Gerrard Construction Gen. Contractor and Development Corporation filed a Petition for Mandamus praying that in view of its availment of the tax amnesty on delinquencies pursuant to the Republic Act (RA) No. 11213, or the Tax Amnesty Act, the Court mandates the Respondent to issue the Certificate of Tax Delinquencies (CTD) and Acceptance Payment Form (APF) in its favor so it may be deemed to have fully complied with all the conditions set forth in the law, including the payment of its amnesty tax, that its delinquency may be considered settled, and that the tax amnesty granted become final and irrevocable. On the other hand, the Respondent Bureau of Internal Revenue contended that the Petitioner is, in truth and in fact, not entitled to the Tax Amnesty Program under RA No. 11213. In ruling, the Petitioner failed to establish that it has a clear legal right to be issued a CTD and APF. When Petitioner availed of the Tax Amnesty in 2019, it had yet no tax delinquency which would qualify under the Tax Amnesty Act. There is also no showing that the Petitioner withheld taxes and had failed to remit the same, as required by the Tax Amnesty Act. Consequently, the Petition was DISMISSED. [ST. GERRARD CONSTRUCTION GEN. CONTRACTOR & DEVELOPMENT CORPORATION VS. BUREAU OF INTERNAL REVENUE, CTA CASE NO. 10427, APRIL 5, 2023]
Appellate court affirms Petron’s canceled P64.33-million tax liabilities [BusinessWorld, June 12, 2023]
The tribunal agreed with its First Division that Petron’s importations of alkylate are not subject to excise tax. Citing the Tax Code, it said alkylate cannot be classified as a raw material that is a product of distillation that can be subjected to excise tax.
Lower income taxes pushed [Philippine Daily Inquirer, June 12, 2023]
To increase tax compliance and broaden the taxpayer base, the government needs to lower the personal income tax ceiling to between 20 and 25 percent from the current 35 percent, according to a tax reform policy advocate.
Commute no more: US employees embrace working from home [ABS-CBN News, June 11, 2023]
Like Claire, millions of employees across the United States have grown fond of telework since the Covid-19 lockdown and now companies are struggling to bring them back to the office.
Makati claim on Bonifacio Global City dead – Taguig [Philippine Daily Inquirer, June 11, 2023]
The Taguig City government criticized Makati City Mayor Abby Binay for claiming that the jurisdiction dispute over the Bonifacio Global City commercial district and seven barangays is not yet over.
DTI summons 2 big e-commerce platforms for ‘fraudulent sales practices’ [The Philippine Star, June 10, 2023]
The move comes after the agency received several customer complaints about online sellers retailing fake, defective, or undelivered parcels on the e-commerce apps.
Ramon Ang to pay 120% premium for more shares in SMC parent [Inquirer Mobile, June 10, 2023]
Billionaire and San Miguel Corp. (SMC) president Ramon Ang will complete a P10.9-billion investment in listed Top Frontier Investment Holdings Inc., the parent firm of the conglomerate, by the end of the month.
Manila Bay casino developer seeks P25-B loan from China Bank [Philippine Daily Inquirer, June 9, 2023]
Suntrust, which is partly owned by billionaire Andrew Tan’s Megaworld Corp., earlier announced a target to open the Westside City casino in 2024. The project will be the fourth gaming complex in Entertainment City after Solaire Resort & Casino, City of Dreams Manila and Okada Manila.
SPNEC to break ground on solar farm expansion in Nueva Ecija [BusinessWorld, June 9, 2023]
SP New Energy Corp. (SPNEC) expects to start construction for its over 3,000-hectare solar plant expansion in Nueva Ecija within the year, its top official said on Thursday.
BIR advises taxpayers to seek alternative ePAY solutions as GCash halts tax payments [Bilyonaryo, June 8, 2023]
Commissioner Romeo Lumagui Jr., in the official advisory, disclosed that GXI had promptly notified the Land Bank of the Philippines about the significant number of failed BIR payments made through the GCash app. Consequently, GXI made the decision to disable the tax payment feature until the matter could be thoroughly investigated to identify the root cause of the incident.
Qualified Pinoys may travel to Canada visa-free [The Philippine Star, June 8, 2023]
The Philippines is among 13 countries added to Canada’s electronic travel authorization (eTA) program. Its inclusion comes after the official visit of Canadian Foreign Minister Melanie Joly to the country.
Bongbong Marcos promises improved tax administration [Inquirer.Net, June 7, 2023]
President Ferdinand Marcos Jr. has promised the Federation Of Filipino Chinese Chambers of Commerce & Industry Inc. (FFCCCII) that his administration is working toward better tax administration to help businesses in the country flourish.
Philippines needs updated tax laws for the digital economy — PIDS [The Philippine Star, June 7, 2023]
In a webinar organized by state-run think tank Philippine Institute for Development Studies (PIDS), UP College of Law associate professor Emerson Bañez discussed his study titled “Rethinking Taxation in the Digital Economy,” which evaluated the challenges in taxing digital transactions and analyzed the digital commerce value chain to identify possible legal framework solutions and reform.
Dispute brews over ‘Eat Bulaga’ trademarks: IPOPHL [ABS-CBN News, June 7, 2023]
The IPOPHL said its Bureau of Legal Affairs (BLA) received a petition from TV hosts Tito Sotto, Vic Sotto and Joey De Leon (TVJ) last June 2 to cancel these trademarks of Television and Production Exponents Inc (TAPE), the company that produces the noontime show.
CTA: Comelec should pay over P1B in deficiency withholding tax [GMA News Online, June 6, 2023]
The CTA said that even if the court accepted the Comelec’s reasoning that the person who received the notice was a casual employee, the CTA said the poll body failed to provide evidence that the person had no authority to receive documents for the Comelec.
Lumagui urges new CPAs to uphold ethical standards amid ghost receipts scandal [Bilyonaryo, June 6, 2023]
Addressing the successful candidates of the May 2023 Licensure for CPAs, BIR Commissioner Romeo Lumagui Jr. emphasized the potential pitfalls that CPAs may face if they choose to utilize these fraudulent receipts in their professional endeavors.
AyalaLand to open Pampanga Technopark in Mabalacat City [SunStar Pampanga, June 5, 2023]
Mayor Crisostomo Garbo led the launching of AyalaLand Logistics Holdings Corporation’s Pampanga Technopark in Barangay Tabun here recently.
Tax system being outmaneuvered by digital companies [BusinessWorld, June 5, 2023]
TAX administrators need to adapt to digital platform use by their taxpayers to enhance their ability to capture revenue, the Philippine Institute for Development Studies (PIDS) said.
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