SolGen to act on ‘Chinese – owned’ real estate properties
Other Relevant Tax Updates:
- TAX & BUSINESS-RELATED NEWS [OCTOBER 17-23]
- BIR ANNOUNCES THE AVAILABILITY OF THE ORUS TAXPAYER’S CLASSIFICATION & RECLASSIFICATION UNDER EOPT
- COURT OF TAX APPEALS CASES
- SEC OPINION ON REPRESENTATIVE OFFICE
I. TAX & BUSINESS-RELATED NEWS [OCTOBER 17-23]
- SolGen to act on ‘Chinese – owned’ real estate properties
- Settle P6 billion unpaid claims, hospitals urge PhilHealth
- Ilocos workers get wage hike
- Marcos dangles incentives for investors in e-mobility industry
- RTWPB – Western Visayas OKs P33 – P40 daily wage hike
- Biz group rejects new wage hike in Western Visayas
- Quezon City to get new mega hub to rival PITX
- PCC clears joint venture set to develop Sangley Point Int’l Airport
- MEPZ job losses raise concerns over future of PH import, export sectors
- Proposed power project in Malico rejected
- Richard Gomez files bill banning soda in government offices
- Mitsubishi opens new dealership in Bulacan
- Marcos expands West Cebu Industrial Park
- Dingalan, Aurora requires visitors to secure insurance
- 2 World Bank-funded projects get Neda approval
- Loss-making ABS-CBN to retrench 100 workers
II. BIR ANNOUNCES THE AVAILABILITY OF THE ORUS TAXPAYER’S CLASSIFICATION & RECLASSIFICATION UNDER EOPT
Revenue Memorandum Circular (RMC) No. 113-2024 issued on October 15, 2024, announces the availability of update of taxpayer classification, resumption of business registration, and other registration-related transactions in the Online Registration and Update System (ORUS).
III. CTA CASES DIGEST
[THE IDENTITY OF THE PAYOR & PAYEE MUST BE CLEARLY ESTABLISHED IN BIR FORMS NO. 2307 OR CWT CERTIFICATES] [TAX REFUND OR CREDIT APPLICANTS MUST PROVE NOT ONLY ENTITLEMENT BUT ALSO SHOW COMPLIANCE WITH ALL DOCUMENTARY & EVIDENTIARY REQUIREMENTS]
Petitioner Service Resource, Inc. filed a Petition for Review assailing the Court Special Second Division’s earlier Decision which granted its partial claim for refund. The Petitioner argued that the law and revenue regulations do not specifically provide that BIR Form No. 2307 must contain the name, Taxpayer Identification Number (TIN), and address of the payee before it becomes sufficient in proving the fact of withholding. In ruling, citing the Philippine Bank of Communication case, the requirements for a Creditable Withholding Tax (CWT) refund or tax credit are: (a) file with the CIR within two (2) years; (b) report the income as part of gross income; and (c) provide a payor’s statement showing the payment and tax withheld. The Court in Division found that the Petitioner submitted CWT Certificates with incorrect or missing TIN and address, issued under a different name, and lacking the payor’s authorized signature. Thus, the Petitioner was unable to comply with the 3rd requisite. The Court emphasized that the identity of both parties must be established in these certificates. Failure to do so would necessarily affect the credibility of the said BIR forms. A tax refund or credit applicant must demonstrate both entitlement and compliance with all documentary and evidentiary requirements. Finding no grave abuse of discretion by the Division, the Court En Banc upheld its Decision. Thus, the Petition was DENIED for lack of merit. [SERVICE RESOURCES INC. VS COMMISSIONER OF INTERNAL REVENUE, CTA EN BANC CASE NO. 2776, SEPTEMBER 30, 2024]
[WHILE TAX REFUNDS ARE STRICTLY CONSTRUED AGAINST THE TAXPAYER, THE GOVERNMENT SHOULD NOT RESORT TO TECHNICALITIES & LEGALISMS, MUCH LESS FRIVOLOUS APPEALS, TO KEEP THE MONEY IT IS NOT ENTITLED TO AT THE EXPENSE OF THE TAXPAYERS] [INCOME OF ANY KIND, TO THE EXTENT REQUIRED BY ANY TREATY OBLIGATION BINDING UPON THE GOVERNMENT OF THE PHILIPPINES SHALL NOT BE INCLUDED IN GROSS INCOME & SHALL BE EXEMPT FROM TAXATION]
Petitioner Commissioner of Internal Revenue (CIR) filed a Petition for Review seeking to reverse the earlier Decision promulgated by the Special Third Division of the Court of Tax Appeal (CTA) ordering the Petitioner to refund or issue a Tax Credit Certificate (TCC) in favor of the Respondent Diddley Bow Investment Holdings B.V. (DBI) in the amount of Php 8,389,431.00, allegedly representing Final Withholding Tax (FWT) erroneously withheld on the interest income derived by the Respondent in various T-bonds. The Petitioner argued that the Respondent’s claim for refund should be denied due to the failure of the latter to comply with the documentary requirements and failure to substantiate its administrative claim for tax refund. In addition, the Petitioner submitted that tax refunds are in the nature of exemptions and are to be considered strictissimi juris against the entity claiming the same. On the other hand, the Respondent contended that they have fully substantiated its claim for refund representing its erroneously paid FWT. In ruling, the Court emphasized that the Petitioner did not even present any evidence to controvert the Respondent’s judicial claim for refund. In view of the basic rule that mere allegations are not evidence and not equivalent to proof, the Court ruled that the Petitioner’s allegation is essentially self-serving and devoid of any evidentiary weight. Furthermore, the interests accruing or arising from the T-Bonds are exempt from income taxation pursuant to Section 32(B)(5) of the 1997 Tax Code, in relation to Article 11(3)(a) of the Republic of the Philippines-Netherlands Tax Treaty. Verily, the Court finds that based on the evidence presented and submitted, the Respondent has sufficiently established its entitlement to its claim for FWT refund. Thus, the Petition was DENIED for lack of merit. [COMMISSIONER OF INTERNAL REVENUE VS. DIDDLEY BOW INVESTMENT HOLDINGS B.V., CTA EN BANC CASE NO. 2787, SEPTEMBER 20, 2024]
IV. SEC OPINION
FOREIGN CORPORATION CAN ORGANIZE SUBORDINATE OFFICES & APPOINT OFFICERS AS PERMITTED BY ITS BY-LAWS
N Co. is seeking an opinion on whether it can modify the organizational structure of its representative office by creating additional subordinate offices and appointing subordinate officers as permitted by its Bylaws. Likewise, it is seeking clarification on whether the creation of the “Assistant Secretary” position is permissible under the Revised Corporation Code (RCC). Finally, it is seeking clarification whether nationality and residency requirements are imposed on the representative office. In reply, Section 146 of the Revised Corporation Code (RCC) states that a foreign corporation doing business in the Philippines must follow the same laws as domestic corporations of the same class, except for laws regarding their creation, organization, dissolution, and internal relations among stockholders, members, or officers. In essence, while foreign corporations must follow many local laws, they retain certain rights and privileges related to their organizational structure and internal governance, adhering to their home country’s regulations. Since modification of the organizational structure of its representative office is permitted by its Bylaws, RCC grants the liberty to organize and manage the corporation in accordance with business exigencies. Further, RCC recognizes N Co.’s power to validly create the office of an “Assistant Secretary” and that there is no prohibition on the creation of officer positions for its representative office. Section 24 of the RCC allows foreign corporations to organize and elect other officers provided in the bylaws. Regarding the third query, the imposition of such falls within N Co.’s prerogative, as no nationality or residency requirements for subordinate officers are outlined in its By-laws. [SEC OFFICE OF THE GENERAL COUNSEL OPINION NO. 24-25, SEPTEMBER 19, 2024]
SolGen to act on ‘Chinese – owned’ real estate properties [Inquirer.Net, October 22, 2024]
Surigao del Norte 2nd District Rep. Robert Ace Barbers said there are around 300 to 400 titles covering thousands of hectares of land that were transferred to a Chinese citizen or corporation.
https://globalnation.inquirer.net/253250/solgen-on-quad-comm-dox
Settle P6 billion unpaid claims, hospitals urge PhilHealth [The Philippine Star, October 22, 2024]
The amount includes COVID claims from 2020 to 2022, according to the Private Hospitals Association of the Philippines Inc. (PHAPI).
Ilocos workers get wage hike [Philippine Daily Inquirer, October 22, 2024]
The last wage orders for workers in private establishments and domestic workers in the region were both issued on Oct. 10, 2023, and became effective on Nov. 6, 2023.
https://newsinfo.inquirer.net/1995061/ilocos-workers-get-wage-hike
Marcos dangles incentives for investors in e-mobility industry [GMA News Online, October 22, 2024]
Marcos made the remark as he met with officials of the Department of Science and Technology (DOST) and concerned agencies in Malacañang. The discussions were on the government’s efforts to sustain and improve the country’s e-mobility industry through science, technology, and innovation.
https://www.gmanetwork.com/news/money/economy/924526/marcos-incentives-investors-e-mobility/story/
RTWPB – Western Visayas OKs P33 – P40 daily wage hike [Inquirer Visayas, October 22, 2024]
A daily wage increase of from P33 to P40 for workers in private establishments and P1,000 for household service workers or “kasambahays” in Western Visayas have been approved by the Regional Tripartite Wages and Productivity Board (RTWPB).
https://newsinfo.inquirer.net/1995537/rtwpb-western-visayas-oks-p33-p40-daily-wage-hike
Biz group rejects new wage hike in Western Visayas [Philippine Daily Inquirer, October 21, 2024]
The Metro Bacolod Chamber of Commerce and Industry (MBCCI) led by chief executive officer Frank Carbon said the group has filed its objection to a new round of salary increases before the Regional Tripartite Wages and Productivity Board (RTWPB) on Oct. 15.
https://newsinfo.inquirer.net/1994738/biz-group-rejects-new-wage-hike-in-western-visayas
Quezon City to get new mega hub to rival PITX [Manila Bulletin, October 21, 2024]
The proposed transport hub, tentatively named “Project HUB,” is expected to enhance connectivity in the area. It aims to provide support to existing transportation lines and will be seamlessly integrated with the MRT-7, which is scheduled to start operating in 2027.
https://mb.com.ph/2024/10/21/qc-to-get-new-mega-hub-to-rival-pitx
PCC clears joint venture set to develop Sangley Point Int’l Airport [GMA News Online, October 21, 2024]
This comes as the Cavite provincial government in September 2022 awarded the $11-billion contract to develop Sangley Point to the SPIA Development Consortium, which includes Virata-led Cavitex Holdings Inc., and Yuchengco-led House of Investments.
MEPZ job losses raise concerns over future of PH import, export sectors [Cebu Daily News, October 20, 2024]
“When there are losses in employment in the economic zones, it affects everything including our dollars, our capacity to import and trade with the rest of the world,” Senator Imee Marcos said.
Proposed power project in Malico rejected [The Manila Times, October 20, 2024]
The provincial government of Nueva Vizcaya has expressed opposition to the FDC Renewables Corp.’s proposed 33.40 megawatts Pampang Hydroelectric Power Project (PHePP) in Barangay Malico in this town because it will only “deprive residents and Indigenous peoples of the benefits from abundant water resources.”
https://www.manilatimes.net/2024/10/20/regions/proposed-power-project-in-malico-rejected/1987668
Richard Gomez files bill banning soda in government offices [The Philippine Star, October 20, 2024]
Gomez added that his proposed bill complements other health policies and programs, such as the National Nutrition Council’s initiatives to promote healthy eating habits and the Department of Health’s campaign against lifestyle-related diseases.
Mitsubishi opens new dealership in Bulacan [Philippine Daily Inquirer, October 20, 2024]
Mitsubishi Motors Philippines Corp. (MMPC) said that it, along with dealer partner SJ Legacy Motors Inc., inaugurated their new branch at the SM City San Jose Del Monte on Sept. 27.
https://business.inquirer.net/485680/mitsubishi-opens-new-dealership-in-bulacan
Marcos expands West Cebu Industrial Park [GMA News Online, October 20,2024]
Under Proclamation 710, parcels of land in Barangays Arpili and Buanoy in the Municipality of Balamban in the Cebu Province were included in the economic zone, with an aggregate area of 1,76,783 square meters.
https://www.gmanetwork.com/news/money/economy/924289/marcos-expands-west-cebu-industrial-park/story/
Dingalan, Aurora requires visitors to secure insurance [GMA News Online, October 18, 2024]
Such insurance is meant for tourists “who would suffer disability and/or death while in the territorial jurisdiction of Dingalan.”
2 World Bank-funded projects get Neda approval [Philippine Daily Inquirer, October 18, 2024]
The National Economic and Development Authority (Neda) board has approved two World Bank-funded projects on health care and transport connectivity, which President Marcos said would have a lasting impact on the country.
https://newsinfo.inquirer.net/1993898/2-world-bank-funded-projects-get-neda-approval
Loss-making ABS-CBN to retrench 100 workers [The Manila Times, October 17, 2024]
The Lopez-led company, in a statement, said that around 100 staffers, or about 3 percent of its workforce, would be let go given ongoing challenges.
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