WEEKLY TAX UPDATES [JUNE 18] BIR extends deadline of EOPT invoicing requirements compliance
Relevant Highlights:
- TAX & BUSINESS-RELATED NEWS [JUNE 12-16]
- BIR AMENDS THE TRANSITORY PROVISIONS RELATIVE TO THE DEADLINE FOR INVOICING REQUIREMENTS COMPLIANCE
- CTA CASES
I. TAX & BUSINESS-RELATED NEWS [JUNE 12-16]
- Singapore taps Cebu Pacific for travel promo
- LTO to charge dealers of cars, motorcycles for late issuance of OR/CR
- SEC seat is next for lawyer who aided Marcos in poll protest
- Digitized border protection implemented in 2 years – DOF
- CLI opens first hotel outside Cebu City
- NY Court denies RCBC plea to change trial venue of cyberheist case
- GSIS waives P1.6B in debt relief plan
- LOOK: 56 Philippine universities ranked globally in the 2024 THE Impact Rankings
- EEI inks supply deal with Chua Group
- Central Visayas to lose 14% of economy as NegOr, Siquijor join Negros Island Region
- France makes 700-million-euro offer for Atos security units
- Work starts on P16.9-B Calamba train depot of North-South railway
- Nokia tasked to replace Globe’s legacy assets
- Another singer-Marcos loyalist gets gov’t post
- Incorporator in Pampanga POGO hub says name used without consent
- Marcos signs Real Property Valuation and Assessment Reform Act
- Fintech startup BayaniPay eyes $200M in payments processed in 2024
- P3-B port and industrial park rising in Batangas
- Court of Appeals extends freeze on MFT assets
- PHL has room to raise taxes — IMF
II. BIR AMENDS THE TRANSITORY PROVISIONS RELATIVE TO THE DEADLINE FOR INVOICING REQUIREMENTS COMPLIANCE
Revenue Regulations (RR) No. 11-2024 issued on June 13, 2024, amends the transitory provisions of RR No. 7-2024 relative to the deadlines for compliance with the invoicing requirements.
Highlights include:
- Taxpayers are not required to replace its existing BIR Certificate of Registration that displays the Registration Fee.
- Removal of the December 31, 2024 deadline for the use of Unused Official Receipts converted to Invoice. Thus, taxpayers may use the converted Unused Official Receipts until they are fully consumed.
- Taxpayer may convert and use the remaining Official Receipts as Invoice and convert the Billing Statement/Statement of Account/Statement of Charges into Billing Invoice until fully consumed.
- Extended deadline for submission of inventory report of Unused Official Receipts/Billing Statement/Statement of Account/Statement of Charges converted into Invoice/Billing Invoice on or before July 31, 2024.
- Extended deadline for enhancement of Cash Register Machine (CRM)/Point-of-Sales (POS) Machines, e-Receipting or Electronic Invoicing Software, Computerized Accounting System (CAS)/Computerized Books of Accounts (CBA) with Accounting Records (AR) until December 31, 2024. Any extension must be approved by the concerned Regional Director or Assistant Commissioner of the Large Taxpayers Service which shall no longer than six (6) months from December 31, 2024.
- Submission of notice on renaming of Official Receipt by CRM/POS/CAS/CBA with AR shall be within 30 days from completion of reconfiguration/enhancement or on December 31, 2024, whichever comes first.
III. CTA CASES
[GROSS RECEIPTS FOR THE PRECEDING CALENDAR YEAR THAT HAS BEEN SUBJECTED TO A 3% FRANCHISE TAX MUST BE SHOWN IN ORDER TO AVAIL OF THE EXEMPTION] [“IN LIEU OF ALL TAXES” CLAUSE IS LIMITED TO THE KIND OF TAXES, TAXING AUTHORITY & OBJECT TAXES SPECIFIED IN LAW]
Petitioner National Grid Corporation of the Philippines filed a Petition for Review praying for the reversal of the decision and resolution both rendered by the Respondent City Government of Quezon City and the Regional Trial Court (RTC) dismissing the claim of Local Business Tax (LBT) refund paid under protest. Petitioner argued that with the enactment of Republic Act (R.A.) No. 9511 granting the Petitioner a Franchise to engage in the business of transmitting electricity and other activities that are necessary to support the safe and reliable operation of a transmission system of the Republic of the Philippines, it is exempt from the payment of business taxes, including the city tax upon its payment of 3% Franchise Tax based on its gross receipts. Likewise,
Petitioner asserts that since its legislative franchise contains an “in lieu of all taxes” clause, it is exempt from paying all kinds of taxes, whether levied or collected by any authority, including local government units, as long as it is in connection with its franchise. In ruling, the court disagreed. To avail of tax exemptions, tax exemptions must be clear and unequivocal and must be directly stated in a specific legal provision; and the “in lieu of all taxes” clause is limited to the kind of taxes, taxing authority, and object of taxes specified in the law. Petitioner’s Franchise constitutes an express and categorical statement that it is exempt from payment of local taxes on its gross receipts from its electric power transmission. However, it must have paid the 3% franchise tax on the gross receipts to be exempted. The 2020 gross receipts of the Petitioner must be subjected to a 3% Franchise Tax to avail of the 2021 local tax exemption. Section 143 of the Local Government Code (LGC) of 1991 provides that “tax on business” must be based on “gross sales or receipts for the preceding calendar year. Thus, for the Petitioner to avail of its exemption, it must show that the gross receipts for the preceding calendar year have been subjected to a 3% Franchise Tax. For petitioner to continue the exempt business activity, it is incumbent upon the Petitioner to show that the gross receipts from electric power transmission for the preceding year, 2020, were properly subjected to 3% Franchise Tax as required under R.A. 9511. Consequently, the Petition was PARTIALLY GRANTED, and the case was REMANDED to the Regional Trial Court for further proceedings. [NATIONAL GRID CORPORATION OF THE PHILIPPINES VS. CITY GOVERNMENT OF QUEZON CITY, CTA AC NO. 273, MAY 29, 2024]
DUE PROCESS REQUIRES THE BIR TO CONSIDER THE DEFENSES & EVIDENCE SUBMITTED BY THE TAXPAYER & TO RENDER A DECISION BASED ON THESE SUBMISSIONS; FAILURE TO ADHERE TO THESE REQUIREMENTS CONSTITUTES A DENIAL OF DUE PROCESS & TAINTS THE ADMINISTRATIVE PROCEEDINGS WITH INVALIDITY
Petitioner Sumitomo Corporation-Manila Branch filed a Petition for Review seeking the cancellation of the assessment issued by the Respondent Commissioner of Internal Revenue (CIR). Petitioner argued that the tax assessments were erroneous and lacked a factual and legal basis and that the Respondent failed to comply with procedural requirements, invalidating the assessments. On the contrary, the Respondent argues that the tax assessments were valid and based on proper procedures and that they complied with all procedural requirements in issuing the assessment notices. In ruling, the Court found merit in the Petitioner’s contention that its right to due process was violated based on Section 228 of the 1997 Tax Code, as amended, and relevant Supreme Court rulings, notably the Avon case wherein the Court emphasized that the taxpayer must not only be allowed to present its defenses and evidence but also that the Commissioner and his subordinates must give due consideration to the same. As noted, the Formal Letter of Demand/Final Assessment Notice (FLD/FAN) failed to sufficiently inform the Petitioner of specific reasons for the BIR’s conclusions, denying the Petitioner a fair opportunity to defend itself. It was also observed that the Respondent did not consider the Petitioner’s defenses and supporting documents adequately, violating due process. Moreover, the period to assess the Petitioner has lapsed. The Respondent’s power to assess was limited by Section 203 of the 1997 Tax Code, and the waivers extending the assessment period were found invalid due to non-compliance with Revenue Memorandum Order No. 20-90 and Revenue Delegation Authority Order No. 05-01 guidelines. Consequently, the Petition was GRANTED, and the resulting assessments were CANCELLED and WITHDRAWN. [SUMITOMO CORPORATION-MANILA BRANCH VS. COMMISSIONER OF INTERNAL REVENUE, CTA CASE NO. 10412, MAY 14, 2024]
Low-cost carrier Cebu Pacific has signed a fresh partnership with the Singapore government to promote the city state’s travel and cruise industry to Filipinos.
https://www.philstar.com/business/2024/06/16/2363137/singapore-taps-cebu-pacific-travel-promo
LTO to charge dealers of cars, motorcycles for late issuance of OR/CR [Inquirer.Net, June 16, 2024]
“In a memorandum issued to the DOTr, Malacañang emphasized that all vehicle dealers must comply with the LTO’s prescribed processing timelines for the release of motor vehicles plates.
SEC seat is next for lawyer who aided Marcos in poll protest [Philippine Daily Inquirer, June 16, 2024]
Quevedo previously headed the Office of the Government Corporate Counsel (OGCC), the legal office of all government-owned or -controlled corporations, their subsidiaries and other corporate offsprings.
https://newsinfo.inquirer.net/1951962/sec-seat-is-next-for-lawyer-who-aided-marcos-in-poll-protest
Digitized border protection implemented in 2 years – DOF [The Philippine Star, June 16, 2024]
President Marcos issued AO 23 to expedite the inspection of all imported commodities entering the Philippines through digital and integrated pre-border technical verification and cross-border electronic invoicing.
CLI opens first hotel outside Cebu City [Philippine Daily Inquirer, June 15, 2024]
Soberano family-led Cebu Landmasters Inc. (CLI) has launched a new P2-billion Citadines hotel in the Visayas, this time in Bacolod City, pushing it closer to its goal of expanding the hospitality business outside Cebu City.
https://business.inquirer.net/463741/cli-opens-first-hotel-outside-cebu-city
NY Court denies RCBC plea to change trial venue of cyberheist case [Philippine Daily Inquirer, June 15, 2024]
In a stock exchange filing on Friday, RCBC said it had received on Thursday a June 13 order from the New York Appellate Division denying the bank’s motion for leave to appeal on the issue of forum non conveniens.
GSIS waives P1.6B in debt relief plan [Philippine Daily Inquirer, June 15, 2024]
The HARCP allows lenders to adjust their monthly payments, extend repayment periods up to ten years, and avail a 50-percent discount on the remaining interest if they pay the total debt in full.
https://newsinfo.inquirer.net/1951746/gsis-waives-p1-6b-in-debt-relief-plan
LOOK: 56 Philippine universities ranked globally in the 2024 THE Impact Rankings [Manila Bulletin, June 14, 2024]
Here are the 56 Philippine HEIs that were among the globally-ranked universities in the 2024 THE IR release on June 12:
EEI inks supply deal with Chua Group [Philippine Daily Inquirer, June 14, 2024]
The manufacturing arm of the Chua Group’s Industry Holdings and Development Corp. (IHDC) has agreed to provide construction materials for Yuchengco-led EEI Corp.’s mega infrastructure projects in the country.
https://business.inquirer.net/463701/eei-inks-supply-deal-with-chua-group
Central Visayas to lose 14% of economy as NegOr, Siquijor join Negros Island Region [Cebu Daily News, June 14, 2024]
Central Visayas is set to lose P179 billion in its economy or an estimated 14 percent as Negros Oriental and Siquijor splits from Region 7 with the creation of Negros Island Region (NIR) which was recently signed into law by President Ferdinand Marcos Jr.
France makes 700-million-euro offer for Atos security units [Inquirer.Net, June 14, 2024]
Atos, which holds contracts with the French army and is the IT partner for the Paris Olympics, is sagging under almost five billion euros of debt.
https://business.inquirer.net/463724/france-makes-700-million-euro-offer-for-atos-security-units
Work starts on P16.9-B Calamba train depot of North-South railway [Philippine Daily Inquirer, June 14, 2024]
On Thursday, the Department of Transportation (DOTr) broke ground for Banlic Depot, a 24.5-hectare facility designed to include a control center, stabling yard, maintenance shop, and other ancillary buildings.
Nokia tasked to replace Globe’s legacy assets [The Philippine Star, June 14, 2024]
Wireless giant Globe Telecom Inc. is moving on from some of its legacy solutions by deploying a modern replacement developed by Nokia that integrates fixed and wireless access.
Another singer-Marcos loyalist gets gov’t post [Philippine Daily Inquirer, June 14, 2024]
President Marcos has named singer-turned-politician Anthony Castelo as vice chair and chief operating officer of the Bataan Shipyard and Engineering Co., a state firm controlled by the Presidential Commission on Good Government.
https://newsinfo.inquirer.net/1951429/another-singer-marcos-loyalist-gets-govt-post
Incorporator in Pampanga POGO hub says name used without consent [GMA News Online, June 13, 2024]
The incorporator said his previous Chinese employer used his and his family’s names to register the business Lucky South 99, the corporation that runs the illegal POGO hub.
Marcos signs Real Property Valuation and Assessment Reform Act [Inquirer.Net, June 13, 2024]
President Ferdinand Marcos Jr. on Thursday signed into law a measure that, among others, sets a two-year amnesty on interests, surcharges, and penalties for unpaid real property tax.
https://business.inquirer.net/463571/marcos-signs-real-property-valuation-and-assessment-reform-act
Fintech startup BayaniPay eyes $200M in payments processed in 2024 [GMA News Online, June 13, 2024]
He said BayaniPay aims to augment the economic impact of cross-border direct payments by making them frictionless and cost-effective, which helps Filipinos overseas save on fees and add more pesos to every dollar they send.
P3-B port and industrial park rising in Batangas [Manila Bulletin, June 12, 2024]
Ferdinand Co., president of Sinisian Lemery Batangas Port & Industrial Park Corp., said the seven-hectare complex has three major components: the Sinisian Lemery Batangas Port & Industrial Park, the Lemery Cement Silo Tank, and Lemery Oil Terminal. Each of the project component has an investment of more than one billion pesos.
https://mb.com.ph/2024/6/12/p3-b-port-and-industrial-park-rising-in-batangas
Court of Appeals extends freeze on MFT assets [BusinessMirror, June 12, 2024]
The Court of Appeals (CA) has extended for six months its freeze order on the bank, investment and insurance accounts of Maria Francesca Tan Group of Companies Inc. (MFT).
https://businessmirror.com.ph/2024/06/12/court-of-appeals-extends-freeze-on-mft-assets/
PHL has room to raise taxes — IMF [BusinessWorld, June 12, 2024]
THE PHILIPPINES’ fiscal consolidation plan may be too “ambitious,” the International Monetary Fund (IMF) said, noting that the government still has room to raise taxes to generate much-needed revenues.
https://www.bworldonline.com/top-stories/2024/06/12/601141/phl-has-room-to-raise-taxes-imf/
Recent Comments