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COURT RULINGS/ DECISIONS

A. GENERAL PRINCIPLES
LAND BANK OF THE PHILIPPINES VS.
CACAYURAN – (G.R. 191867 - 04/22/15)

FACTS:
• THE MUNICIPALITY OF AGOO, LA UNION PASSED A
RESOLUTION AUTHORIZING ITS MAYOR TO OBTAIN A LOAN
FROM THE PETITIONER (LBP) AND MORTGAGE AS
COLLATERAL PORTION OF THE AGOO PLAZA.
• AS ADDITIONAL SECURITY, THE MUNICIPALITY ASSIGNED A
PORTION OF ITS INTERNAL REVENUE ALLOTMENT (IRA) IN
FAVOR OF THE PETITIONER.
• THE LOAN PROCEEDS WERE USED TO CONSTRUCT A
COMMERCIAL CENTER ON THE PLAZA WHICH WAS
OBJECTED BY THE LOCAL RESIDENTS INCLUDING THE
RESPONDENT CACAYURAN.
LAND BANK OF THE PHILIPPINES VS.
CACAYURAN – (G.R. 191867 - 04/22/15)

ISSUE:

DID THE RESPONDENT HAVE STANDING TO FILE FOR


THE NULLIFICATION OF THE LOAN?
LAND BANK OF THE PHILIPPINES VS.
CACAYURAN – (G.R. 191867 - 04/22/15)

RULE:
YES, THE TWO REQUISITES FOR A TAXPAYER’S SUIT HAVE BEEN
COMPLIED WITH:

1. EVEN IF THE CONSTRUCTION OF THE COMMERCIAL CENTER


WOULD BE SOURCED FROM THE LOAN PROCEEDS FROM LBP,
THE SAID FUNDS WERE ALREADY CONVERTED INTO PUBLIC
FUNDS UPON RECEIPT BY THE MUNICIPALITY, AND THE
ASSIGNMENT OF THE IRA, LIKEWISE CHARACTERIZED THE
FUNDS AS PUBLIC.
LAND BANK OF THE PHILIPPINES VS.
CACAYURAN – (G.R. 191867 - 04/22/15)

RULE:

2. SINCE THE PLAZA IS FOR PUBLIC USE, THE RESPONDENT


CACAYURAN, LIKE ALL OTHER AGOO RESIDENTS, IS DIRECTLY
AFFECTED. BESIDES IT HAS BEEN HELD THAT AS LONG AS
TAXES ARE INVOLVED, PEOPLE HAVE A RIGHT TO QUESTION
GOVERNMENT CONTRACTS EVEN IF THEY ARE NOT PARTY TO
THE CONTRACT. THIS IS UNDER THE PRINCIPLE OF
TRANSCENDENTAL IMPORTANCE.
B. INCOME TAX
DPWH VS. SORIANO
(G.R. 211666 – 02/25/15)

ISSUE:

IN EXPROPRIATION PROCEEDINGS, WHICH PARTY IS


LIABLE FOR THE TAXES DUE ON THE TRANSFER OF
THE PROPERTY TAKEN?
DPWH VS. SORIANO
(G.R. 211666 – 02/25/15)

RULE:
• THE BUYER OWNER IS STILL THE PARTY LIABLE FOR THE CGT
IN EXPROPRIATION PROCEEDINGS, ALTHOUGH THE SAID
LIABILITY IS ENFORCED VIA A WITHHOLDING TAX OBLIGATION
IMPOSED ON DPWH AS THE WITHHOLDING AGENT.

• HOWEVER, THE DST IS A LIABILITY OF THE GOVT. SINCE THE


DPWH’S GUIDE IN ACQUIRING PROPERTY THROUGH
EXPROPRIATION CLEARLY PROVIDES THAT THE GOVT. SHOULD
SHOULDER THIS TAX.
BANCO DE ORO VS. CIR
(G.R. 198756 – 01/13/15)

FACTS:
ON OCT. 7, 2011, THE BIR ISSUED RULING NO. 370-2011
DECLARING THAT ALL TREASURY BOND (INCLUDING POVERTY
ERADICATION AND ALLEVIATION CERTIFICATES, OR PEACE
BONDS), REGARDLESS OF THE NUMBER OF PURCHASERS/
LENDERS AT THE TIME OF ORIGINATION/ISSUANCE, ARE
CONSIDERED DEPOSIT SUBSTITUTES SUBJECT TO THE 20%
FINAL WITHHOLDING TAX (FWT).
BANCO DE ORO VS. CIR
(G.R. 198756 – 01/13/15)

FACTS:
• THE SUPREME COURT(SC) HELD THAT BIR RULING NO. 370-2011
IS ERRONEOUS IN SO FAR AS THAT ALL TREASURY BONDS,
REGARDLESS OF THE NUMBER OF PURCHASERS/ LENDERS AT
THE TIME OF ORIGINATION/ ISSUANCE, ARE CONSIDERED
DEPOSIT SUBSTITUTES.

• THUS, THE SC DECLARED VOID BIR RULING NO. 370-2011


BECAUSE IT COMPLETELY DISREGARDED THE “20 OR MORE
LENDER” RULE UNDER THE TAX CODE, AND IT CREATED A
DISTINCTION BETWEEN DEBT INSTRUMENTS ISSUED BY THE
GOVT. AND THOSE ISSUED BY PRIVATE CORP. WHEN THERE
WAS NONE IN THE LAW.
BANCO DE ORO VS. CIR
(G.R. 198756 – 01/13/15)

FACTS:
• WITH RESPECT TO THE PEACE BONDS, THE SC NOTED THAT
WHILE IT SEEMS THAT THERE WAS ONLY ONE LENDER TO
WHOM THE PEACE BONDS WERE ISSUED AT THE TIME OF
OIGINATION, A READING OF THE UNDERWRITING AGREEMENT
REVEALS THAT THE SETTLEMENT DATES FOR THE SALE AND
DISTRIBUTION OF THE PEACE BONDS TO VARIOUS
UNDISCLOSED INVESTORS AT A PURCAHSE PRICE FELL ON THE
SAME DAY WHEN THE PEACE BONDS WERE SUPPOSEDLY
ISSUED AND, THUS, THE SC DOES NOT KNOW HOW MANY
INVESTORS THE PEACE BONDS WERE SOLD TO.
BANCO DE ORO VS. CIR
(G.R. 198756 – 01/13/15)

FACTS:
• HOWEVER, SHOULD THERE HAVE BEEN A SIMULTANEOUS SALE
TO 20 OR MORE LENDERS/INVESTORS, THE SC HELD THAT THE
PEACE BONDS SHOULD BE DEEMED DEPOSIT SUBSTITUTES
SUBJECT TO THE 20% FWT ON THE INTEREST OR DISCOUNT
FROM THE PEACE BONDS.

• FURTHER, THE OBLIGATION TO WITHHOLD THE 20% FINAL TAX


ON THE CORRESPONDING INTEREST FROM THE PEACE BONDS
WOULD LIKEWISE BE REQUIED OF ANY LENDER/ INVESTOR HAD
THE LATTER TURNED AROUND AND SOLD SAID PEACE BONDS,
WHETHER IN WHOLE OR PART, SIMULTANEOUSLY TO 20 OR
MORE LENDERS OR INVESTORS.
BANCO DE ORO VS. CIR
(G.R. 198756 – 01/13/15)

FACTS:
• AT THE SAME TIME, THE SC CLARIFIED THAT SHOULD IT
BE FOUND THAT THE PEACE BONDS WERE SOLD TO 20
OR MORE LENDERS/INVESTORS, THE BIR MAY STILL
COLLECT THE UNPAID TAX WITHIN 10 YEARS AFTER THE
DISCOVERY OF THE OMISSION.
(Banco De Oro, Bank of Commerce, China Banking Corp., Metropolitan Bank & Trust
Co., Philippine Bank of Communications, Philippine National Bank, Philippine Veterans
Bank, and Planters Development Bank vs. Republic of the Phil., Bureau of Internal
Revenue, Sec. of Finance, Department of Finance, The National Treasurer, and Bureau
of Treasury, G.R. No. 198756, January 13, 2015)
BANCO DE ORO VS. CIR
(G.R. 198756 – 01/13/15)

FACTS:
• THE BIR INITIALLY ISSUED A BIR RULING IN 2011 TO CODE-NGO
CONFIRMING THAT THE ‘PEACE BONDS’ ARE NOT DEPOSIT
SUBSTITUTES AND AS SUCH WERE NOT SUBJECT TO
WITHHOLDING TAX.

• IN 2011, ANOTHER RULING WAS ISSUED IN REPLY TO THE


QUERY OF THE SECRETARY OF FINANCE THIS TIME STATING
THAT THE BONDS ARE IN FACT DEPOSIT SUBSTITUTES SINCE
THE DETERMINATION OF THE 20 OR MORE LENDERS IS “AT ANY
ONE TIME” WHICH MEANS THAT IT IS THE ENTIRE TERM OF THE
BOND AND NOT MERELY THE POINT OF ORIGINATION OR
ISSUANCE.
BANCO DE ORO VS. CIR
(G.R. 198756 – 01/13/15)

ISSUES:
A. DOES THE SUPREME COURT HAVE JURISDICTION?

B. AT WHAT POINT IS THE ‘20 LENDER RULE’


DETERMINED?

C. IS THE INTEREST FROM THE BONDS EXEMPT UNDER


THE EXCLUSION PROVISION ON TRADING GAINS?
BANCO DE ORO VS. CIR
(G.R. 198756 – 01/13/15)

RULE:
A. YES. WHILE BIR RULINGS ARE GENERALLY REVIEWABLE BY THE
SECRETARY OF FINANCE (SOF), THE RULE ON EXHAUSTION OF
ADMINISTRATIVE REMEDIES DOES NOT APPLY SINCE:

1. IT INVOLVED A PURE QUESTION OF LAW

2. AN APPEAL TO THE SOF IS DEEMED FUTILE BECAUSE THE


REQUEST FOR RULING IN 2011 WAS FILED BY THE SOF
HIMSELF.
BANCO DE ORO VS. CIR
(G.R. 198756 – 01/13/15)

RULE:
B. THE PHRASE “AT ANY ONE TIME” FOR PURPOSES OF
DETERMINING THE “20 OR MORE LENDERS” WOULD MEAN
EVERY TRANSACTION EXECUTED IN THE PRIMARY AND
SECONDARY MARKET IN CONNECTION WITH THE SALE OF THE
BONDS. THE COURT ALSO MENTIONED THAT INCOME FROM
DEBT INSTRUMENTS THAT ARE NOT DEPOSIT SUBSTITUTES
ARE NEVERTHELESS SUBJECT TO THE REGULAR INCOME TAX
RATES.
BANCO DE ORO VS. CIR
(G.R. 198756 – 01/13/15)

RULE:
C. NO. THE TERM “GAINS” AS USED IN SECTION 32 DOES NOT
INCLUDE INTERESTS WHICH REPRESENTS FORBEARANCE FOR
THE USE OF MONEY. THE EXCLUSION COVERS GAINS
REPRESENTING THE DIFFERENCE BETWEEN THE SELLING
PRICE AND THE PURCHASE PRICE OF THE BONDS IN CASES
WHERE THE SAID SECURITIES ARE TRANSFERRED/ SOLD.
BDO, et. Al. vs. Republic, CIR, DOF,
National Treasurer

Review of BIR Ruling by SC under Exceptional


Circumstances
• The rule on exhaustion of administrative remedies also finds no
application when the exhaustion will result in an exercise in futility.

• In this case, an appeal to the Secretary of Finance from the questioned


BIR Ruling would be a futile exercise because it was upon the
request of the Secretary of Finance that the 2011 BIR Ruling was
issued by the BIR. It appears that the Secretary of Finance adopted the
Commissioner of Internal Revenue’s opinions as his own.
BDO, et. Al. vs. Republic, CIR, DOF,
National Treasurer

Review of BIR Ruling by SC under Exceptional


Circumstances
• This position was in fact confirmed in the letter dated Oct. 10, 2011
where he ordered the BTr to withhold the amount corresponding to the
20% FWT on the interest or discounts allegedly due from the
bondholders on the strength of the 2011 BIR Ruling.

• The SC EB agreed with respondents that the jurisdiction to review the


rulings of the CIR pertains to the CTA. The questioned BIR Ruling Nos.
370-2011 and DA 378-2011 were issued in connection with the
implementation of the 1997 NIRC on the taxability of the interest
income from zero-coupon bonds issued by the government.
BDO, et. Al. vs. Republic, CIR, DOF,
National Treasurer

Review of BIR Ruling by SC under Exceptional


Circumstances
• In exceptional cases, SC entertained direct recourse to it when
“dictated by public welfare and the advancement of public policy, or
demanded by the broader interest of justice, or the orders complained
of were found to be patent nullities, or the appeal was considered as
clearly an inappropriate remedy.”

• The nature and importance of the issues raised to the investment and
banking industry and the novelty, constitute exceptional and compelling
circumstances.
WINEBRENNER & INIGO
INSURANCE BROKERS, INC. VS. CIR
(G.R. 206526 – 01/28/15)
FACTS:
• ON APRIL 15, 2004, WIIBFILED ITS ANNUAL INCOME TAX RETURN
FOR CY 2003.

• ABOUT TWO YEARS THEREAFTER OR ON APRIL 7, 2006, WIIB


FILED A CLAIM FOR REFUND OF ITS UNUTILIZED CWT FOR CY
2003 IN THE AMOUNT OF AROUND P4M.

• DUE TO INACTION BY CIR, WIIB FILED A PETITION FOR REVIEW


WITH THE CTA ON APRIL 11, 2006 WHICH PARTIALLY GRANTED A
REFUND IN THE AMOUNT OF AROUND P2.7M.

• WIIB ELEVATED ITS APPEAL TO CTA EN BANC.


WINEBRENNER & INIGO
INSURANCE BROKERS, INC. VS. CIR
(G.R. 206526 – 01/28/15)
FACTS:
• CIR ALSO MOVED FOR RECONSIDERATION WITH THE CTA EN
BANC FOR DENIAL OF THE ENTIRE CLAIM.

• THE CTA EN BANC DENIED THE REFUND CLAIM SINCE WIIB


FAILED TO PROVE THAT THE EXCESS CWT FOR CY 2003 WAS
NOT CARRIED OVER TO THE SUCCEEDING QUARTERS OF THE
SUBJECT TAXABLE YEAR.

• UNDER THE 1997 NIRC, A TAXPAYER MUST NOT HAVE


EXERCISED THE OPTION TO CARRY OVER THE EXCESS CWT
FOR A PARTICULAR TAXABLE YEAR IN ORDER TO QUALIFY FOR
REFUND.
WINEBRENNER & INIGO
INSURANCE BROKERS, INC. VS. CIR
(G.R. 206526 – 01/28/15)

ISSUE:

IS THE SUBMISSION AND PRESENTATION OF THE


QUARTERLY ITRs OF THE SUCCEEDING QUARTERS OF
THE TAXABLE YEAR INDISPENSABLE IN A CLAIM FOR
REFUND?
WINEBRENNER & INIGO
INSURANCE BROKERS, INC. VS. CIR
(G.R. 206526 – 01/28/15)

RULE:
NO. WHILE PRESENTING THE SUCCEEDING QUARTERLY ITRs
SIGNIFICANTLY HELP CLAIMANT’S PURPOSE IN PROVING THAT IT
DID NOT CARRY OVER THE EXCESS INCOME TAX, THEY ARE NOT
ABSOLUTELY NEEDED AS SECTION 76 OF THE TAX CODE DOES
NOT MANDATE IT.

THE LAW MERELY REQUIRES THE FILING OF THE ITR/ FINAL


ADJUSTMENT RETURN (FAR) FOR THE PRECEDING – NOT THE
SUCCEEDING TAXABLE YEAR.
WINEBRENNER & INIGO
INSURANCE BROKERS, INC. VS. CIR
(G.R. 206526 – 01/28/15)

RULE:
LIKEWISE, R.R. 12-94 MERELY PROVIDES THAT CLAIMS FOR
REFUND OF INCOME TAXES DEDUCTED AND WITHHELD FROM
INCOME PAYMENTS SHALL BE GIVEN DUE COURSE ONLY WHEN:

A. IT IS SHOWN ON THE ITR THAT THE INCOME PAYMENT


RECEIVED IS BEING DECLARED AS PART OF THE TAXPAYER’S
GROSS INCOME .

B. THE FACT OF WITHHOLDING IS ESTABLISHED BY A COPY OF


THE WITHHOLDING TAX STATEMENT, DULY ISSUED BY THE
PAYOR TO THE PAYEE, SHOWING THE AMOUNT PAID AND THE
INCOME TAX WITHHELD FROM THAT AMOUNT.
WINEBRENNER & INIGO
INSURANCE BROKERS, INC. VS. CIR
(G.R. 206526 – 01/28/15)

RULE:
MOREOVER, THE THREE (3) REQUIREMENTS (DISCUSSED IN THE
FAR EAST BANK CASE )FOR A CLAIM OF OVERPAYMENT OF
INCOME TAX DOES NOT INCLUDE PRESENTING THE SUBSEQUENT
QUARTERLY RETURNS.

THE COURT SAID THAT THE PRESENTATION OF THE INDIVIDUAL


ITR WOULD SUFFICE IN PROVING THAT PRIOR YEAR’S EXCESS
CREDITS WERE NOT UTILIZED FOR THE CURRENT TAXABLE YEAR.
CIR VS. FSM CINEMA, INC.
(CTA En Banc 1084- 01/23/15)

FACTS:
• TAXPAYER WAS REQUIRED BY THE CIR TO PROVE THAT THE
DIVIDEND WAS RECORDED IN THE BOOKS OF BOTH THE
ISSUING AND RECIPIENT STOCKHOLDER IN ORDER TO BE
SPARED FROM THE TAX IMPOSED ON INTER-CORPORATE
DIVIDEND.

• AS PROVIDED BY SEC. 27 OF THE NIRC, DIVIDENDS


RECEIVED BY A DOMESTIC CORP. FROM ANOTHER
DOMESTIC CORP. ARE NOT SUBJECT TO TAX.
CIR VS. FSM CINEMA, INC.
(CTA En Banc 1084- 01/23/15)

FACTS:
• CTA EN BANC DID NOT SUBSCRIBE TO CIR’S ARGUMENT
WHICH WAS A REQUIREMENT UNDER RULING NO. DA 583-99
AND HELD IN THE CASE OF ENGTEK PHIL. INC. VS. CIR.

• THE COURT ARGUED THAT THE ENGTEK CASE CANNOT BE


APPLIED BECAUSE IT HAD A DIFFERENT ISSUE WITH THE
CASE IN QUESTION.

• HENCE, TAXPAYER CANNOT BE HELD LIABLE FOR


DEFICIENCY EXPANDED WITHHOLDING TAX AND FINAL
WITHHOLDING TAX.
C. VALUE ADDED TAX
NORTHERN MINDANAO POWER CORP.
VS. CIR - (G.R. 185115 – 02/18/15)
FACTS:
• NMPC FILED A CLAIM FOR REFUND OF UNUTILIZED INPUT VAT
BASED ON ITS ZERO-RATED SALE OF POWER TO NATIONAL
POWER CORPORATION (NPC).
• A SUBSTANTIAL PORTION OF THE CLAIM WAS DISALLOWED FOR
HAVING BEEN SUPPORTED BY VAT INVOICES WHICH ONLY HAD
THE TIN-VAT STAMPED AND NOT PRINTED.
• THERE WERE ALSO CERTAIN SALES BY NMPC WHICH FAILED TO
INDICATE THE WORDS “ZERO-RATED”.
• LASTLY, THEY ALSO ALLEGED TAT INVOICES AND RECEIPTS ARE
INTERCHANGEABLE AND EITHER SHOULD SUFFICE AS PROOF
OF PURCHASE AND HENCE AS SUPPORT FOR A CLAIM FOR
REFUND.
NORTHERN MINDANAO POWER CORP.
VS. CIR - (G.R. 185115 – 02/18/15)

ISSUE:

IS PETITIONER ENTITLED TO THE CLAIM OF REFUND


ON THE DISALLOWED PORTION?
NORTHERN MINDANAO POWER CORP.
VS. CIR - (G.R. 185115 – 02/18/15)

RULE:
NO. THE REQUIREMENT THAT THE TIN BE IMPRINTED AND NOT
MERELY STAMPED IS A REASONABLE REQUIREMENT IMPOSED BY
THE BIR.

MORE IMPORTANTLY, THE REQUIREMENT OF THE APPEARANCE


OF THE WORDS “ZERO-RATED” ON THE FACE OF THE INVOICE
PREVENTS BUYERS FROM FALSELY CLAIMING INPUT VAT FROM
THEIR PURCHASES WIHEN NO VAT WAS ACTUALLY PAID.

THE FAILURE TO ADHERE TO THE SAID RULES WILL NOT ONLY


EXPOSE THE TAXPAYER TO PENALTIES BUT SHOULD ALSO SERVE
TO DISALLOW THE CLAIM.
NORTHERN MINDANAO POWER CORP.
VS. CIR - (G.R. 185115 – 02/18/15)

RULE:
COURT SAID ALSO THAT INVOICES AND RECEIPTS ARE NOT
INTERCHANGEABLE SINCE THE FORMER REFERS TO SALES
OF GOODS WHILE THE LATTER TO SERVICES.

THIS WAS ALSO THE RULE IN THE CASE OF KEPCO PHIL.


CORP. VS. CIR, G.R. 181858 - 11/24/10.
ROHM APOLLO SEMICONDUCTOR PHIL.
VS. CIR - (G.R. 168950 – 01/14/15)

FACTS:
• PETITIONER FILED A CLAIM FOR REFUND OF UNUTILIZED INPUT
VAT ON PURCHASE OF CAPITAL GOODS.

• THE CLOSE OF THE TAXABLE QUARTER WHEN THE PURCHASES


WERE MADE WAS SEPT. 30, 2000.

• PETITIONER FILED WITH THE CIR AN ADMINISTRATIVE CLAIM


FOR REFUND ON DEC. 11, 2000.

• CIR HAD A PERIOD OF 120 DAYS, OR UNTIL APRIL 10, 2001, TO


ACT ON THE CLAIM.

• THIS 120-DAY PERIOD LAPSED WITHOUT ANY ACTION BY THE


BIR.
ROHM APOLLO SEMICONDUCTOR PHIL.
VS. CIR - (G.R. 168950 – 01/14/15)

FACTS:
• PETITIONER FILED A PETITION FOR REVIEW WITH THE CTA ON
SEPT. 11, 2002.

• CTA DIVISION DENIED THE PETITION WHICH THE CTA EN BANC


AFFIRMED DUE TO PETITIONER’S FAILURE TO SUBMIT ITS VAT
RETURNS FOR THE 3rd QUARTER OF 2001 AND SUBSEQUENT
TAXABLE YEAR WHICH PROVED FATAL TO THE CLAIM SINCE IT
COULD NOT BE DETERMINED WHETHER THE AMOUNT BEING
REFUNDED REMAINED UNUTILIZED.

• DECISION WAS APPEALED TO THE SUPREME COURT.


ROHM APOLLO SEMICONDUCTOR PHIL.
VS. CIR - (G.R. 168950 – 01/14/15)

RULE:
PETITION WAS DENIED ON THE GROUND THAT:
(1) THE JUDICIAL CLAIM WAS FILED OUT OF TIME
(2) THE 30-DAY PERIOD TO APPEAL IS MANDATORY AND
JURISDICTIONAL CITING THE “LANDMARK CASE” OF CIR VS.
SAN ROQUE POWER CORP. THE CIR’S FAILURE TO ACT ON THE
ADMINISTRATIVE CLAIM SHOULD HAVE BEEN TREATED AS A
DENIAL OF THE CLAIM AND PETITIONER WOULD HAVE HAD 30
DAYS FROM APRIL 10, 2001, OR UNTIL MAY 10, 2001, TO FILE A
JUDICIAL CLAIM WITH THE CTA BUT PETITIONER FILED A
PETITION FOR REVIEW WITH THE CTA ONLY ON SEPT. 11, 2002.
THE JUDICIAL CLAIM WAS THUS FILED LATE.
ROHM APOLLO SEMICONDUCTOR PHIL.
VS. CIR - (G.R. 168950 – 01/14/15)

RULE:
THE CASE OF CIR VS. AICHI FORGING CO.OF ASIA, INC. (G.R.
184823, 10/6/10) CLARIFIED THAT IT IS ONLY THE ADMINISTRATIVE
CLAIM THAT MUST BE FILED WITHIN THE 2-YEAR PRESCRIPTIVE
PERIOD.

THE SAN ROQUE CASE, ON THE OTHER HAND, HAS RULED THAT
THE 30-DAY PERIOD ALWAYS APPLIES, WHETHER THERE IS A
DENIAL OR INACTION ON THE PART OF THE CIR.

(THE 30-DAY PERIOD IS A 1997 TAX CODE INNOVATION THAT DOES


AWAY WITH THE OLD RULE WHERE THE TAXPAYER COULD FILE A
JUDICIAL CLAIM WHEN THERE IS AN INACTION ON THE PART OF THE
CIR AND THE TWO-YEAR PRESCRIPTIVE PERIOD IS ABOUT TO
EXPIRE.)
ROHM APOLLO SEMICONDUCTOR PHIL.
VS. CIR - (G.R. 168950 – 01/14/15)

RULE:
AS A GENERAL RULE, THE 30-DAY PERIOD TO APPEAL IS BOTH
MANDATORY AND JURISDICTIONAL.

THE ONLY EXCEPTION TO THIS GENERAL RULE IS WHEN BIR


RULING NO. 489-03 WAS STILL IN FORCE, THAT IS, BETWEEN
DECEMBER 10, 2003 AND OCTOBER 5, 2010.

THE BIR RULING EXCUSED PREMATURE FILING, DECLARING THAT


THE TAXPAYER NEED NOT WAIT FOR THE LAPSE OF THE 120-DAY
PERIOD BEFORE IT COULD SEEK RELIEF WITH THE CTA .
ROHM APOLLO SEMICONDUCTOR PHIL.
VS. CIR - (G.R. 168950 – 01/14/15)
RULE:
THE SAN ROQUE CASE RULED OUT THE APPLICATION OF THE BIR
RULING TO CASES OF LATE FILING.
IN SHORT, PREMATURE FILING IS ALLOWED FOR CASES FALLING
DURING THIS RULING WAS IN FORCE.
NEVERTHELESS, LATE FILING IS ABSOLUTELY PROHIBITED EVEN FOR
CASES FALLING WITHIN THAT PERIOD.
SINCE PETITIONER FILED ITS CLAIM WITH THE CTA ON SEPT. 11, 2002,
THIS WAS BEFORE THE ISSUANCE OF BIR RULING DA-489-03 ON DEC.
10, 2003.
PETITIONER CAN NOT AVAIL OF THIS RULING SINCE ITS SITUATION IS
NOT ONE OF PREMATURE FILING BUT OF LATE FILING.
Application of the Aichi Forging decision:
(G.R. 184823 – 10/06/10)

• BIR Ruling No. DA-489-03 is a general interpretative ruling because it


was in response to a query made by the One Stop Shop Inter-Agency
Tax Credit and Drawback Center of the Dept. of Finance, on what to do
in cases where the taxpayer did not wait for the lapse of the 120-day
period.

• Thus, all taxpayers can rely on this ruling from the time of its issuance
on Dec. 10, 2003 up to its reversal in the Aichi Forging decision on Oct.
06, 2010.
Application of the Aichi Forging decision:
(G.R. 184823 – 10/06/10)

However, SC gave the following exceptions to this rule:

1. If the CIR, through a specific ruling, misleads a particular taxpayer to


prematurely file a judicial claim with CTA

2. Where the CIR, through a general interpretative rule, misleads all


taxpayers into filing judicial claims with the CTA prematurely.

A general interpretative rule issued by the CIR may be relied upon by


taxpayers from the time the rule is issued up to its reversal by the CIR or
the SC, following Sec. 246 of the Tax Code.
Application of the Aichi Forging decision:
(G.R. 184823 – 10/06/10)

Under Sec. 246, any revision, modification or reversal by the CIR or the
SC of a ruling made by the CIR cannot be given retroactive effect if it
will be prejudicial to taxpayers.

In these cases, SC discussed the application of the Aichi Forging


decision. SC reiterated the ruling in Aichi Forging that the observance of
the 120-day period given to the CIR to decide the claim for refund is
mandatory.

The taxpayer can only appeal to the CTA if the CIR fails to act on the
refund claim within 120 days. Said appeal must be made within 30 days
from the lapse of the 120-day period.
SUMMARY OF RULES ON CLAIMS FOR
REFUND OR TAX CREDIT OF
UNUTILIZED INPUT VAT

1. WHEN TO FILE AN ADMINISTRATIVE CLAIM WITH THE CIR

A) GENERAL RULE: SECTION 112(A) AND MIRANT WITHIN 2


YEARS FROM THE CLOSE OF THE TAXABLE QUARTER WHEN
THE SALES WHERE MADE.

B) EXCEPTION: ATLAS* - WITHIN 2 YEARS FROM THE DATE OF


PAYMENT OF THE OUTPUT VAT, IF THE ADMINISTRATIVE
CLAIM WAS FILED FROM JUNE 8, 2007(PROMULGATION OF
ATLAS*) TO SEPT. 12, 2008 (PROMULGATION OF MIRANT).

*ATLAS DOCTRINE RULED THAT CLAIMS FOR REFUND/CREDIT


MUST COMPLY WITH THE 2-YEAR PERIOD UNDER SEC. 229.
SUMMARY OF RULES ON CLAIMS FOR
REFUND OR TAX CREDIT OF
UNUTILIZED INPUT VAT

2. WHEN TO FILE A JUDICIAL CLAIM WITH THE CTA

A. GENERAL RULE: SECTION 112(D) NOT SECTION 229

I. WITHIN 30 DAYS FROM THE FULL OR PARTIAL DENIAL OF THE


ADMINISTRATIVE CLAIM BY THE CIR; OR

II. WITHIN 30 DAYS FROM THE EXPIRATION OF THE 120-DAY


PERIOD PROVIDED TO THE CIR TO DECIDE ON THE CLAIM.
THIS IS MANDATORY BEGINNING JAN. 01, 1998 (EFFECTIVITY
OF THE TAX CODE)

B. EXCEPTION: BIR RULING – 489-03


SUMMARY OF RULES ON CLAIMS FOR
REFUND OR TAX CREDIT OF
UNUTILIZED INPUT VAT
THESE RULES WERE APPLIED BY THE SUPREME COURT IN THE
FOLLOWING CASES, MAJORITY OF WHICH WERE DECIDED IN
2015:
1. SAN ROQUE POWER CORP.
2. TAGANITO MINING CORP.
3. PHILEX MINING CORP.
4. CARGILL PHILIPPINES INC.*
5. CBK POWER CO. LTD.*
6. AICHI FORGING CO. OF ASIA INC.
7. ROHM APOLLO SEMI-CONDUCTORS INC*.
8. NIPPON EXPRESS PHIL CORP.;*
9. PANAY POWER CORP.*
10. SILICON PHIL., INC.*
11. EASTERN TELECOMMUNICATIONS PHIL. INC*.
12. AIR LIQUIDE PHILIPPINES INC.*
13. HEDCOR, INC.*
*DECIDED IN 2015
CIR VS. AGRINURTURE, INC.
(CTA En Banc 1054- 01/13/15)

FACTS:
• PETITIONER WAS BEING ASSESSED BY THE CIR FOR ALLEGED
UNDER DECLARATION OF PURCHASE WHEN IT FAILED TO
SUBMIT THE SUPPOSED REQUIRED INVOICES/ OFFICIAL
RECEIPTS AND SCHEDULE OF PURCHASES AND ITS FAILURE TO
RECONCILE THE DISCREPANCIES NOTED IN THE SUBJECT
LETTER NOTICE.

• PETITIONER CONTESTED THE ASSESSMENT UNTIL THE SAME


REACHED THE CTA EN BANC.
CIR VS. AGRINURTURE, INC.
(CTA En Banc 1054- 01/13/15)

RULE:
• CTA EB DOES NOT AGREE WITH THE CIR’S ASSESSMENT.

• IT WAS RULED THAT CIR SHOULD KNOW THE RECORDS OF ALL


TAXPAYERS, AS IT HAS THE POWER TO KNOW THE RECORDS OF
TAXPAYERS AND ASSESS THE CORRECT AMOUNT OF TAXES AS
PROVIDED BY SEC. 5 OF THE NIRC OF 1997.

• THE COURT LIKEWISE NOTED THAT EVEN GRANTING THAT


THERE WAS AN UNDER-DECLARATION ON PURCHASE ON THE
PART OF THE PETITIONER, THE SAME IS OF NO CONSEQUENCE.
CIR VS. AGRINURTURE, INC.
(CTA En Banc 1054- 01/13/15)

RULE:
• THE FINDING OF UNDER DECLARATION OF PURCHASE DOES
NOT BY ITSELF RESULT IN THE IMPOSITION OF INCOME TAX AND
VAT.

• AN IMPOSITION OF INCOME TAX, IS NOT WHEN THERE IS AN


UNDECLARED PURCHASE, BUT ONLY WHEN THERE WAS AN
INCOME AND SUCH INCOME WAS RECEIVED OR REALIZED BY
THE TAXPAYER.
NORTHWIND POWER DEV’T. CORP.
VS. CIR
(CTA En Banc 1132 & 1141- 01/29/15)
FACTS:
• NPDC, A VAT REGISTERED TAXPAYER ARGUED THAT THE
AMORTIZATION OF INPUT VAT OVER THE USEFUL LIFE OF
CAPITAL GOOD IMPORTED OR PURCHASED WHOSE
AGGREGATE VALUE EXCEEDS P1M UNDER SEC. 4.110-3 OF R.R.
16-2005 SHOULD APPLY ONLY IF THE INPUT VAT THEREON IS
CREDITED AGAINST THE OUTPUT VAT, AND NOT IN CASES OF
REFUND CLAIMS OF INPUT VAT PAID ON IMPORTATION OR
PURCHASE OF CAPITAL GOODS WHICH ARE DIRECTLY
ATTRIBUTABLE TO ZERO-RATED SALES.
NORTHWIND POWER DEV’T. CORP.
VS. CIR
(CTA En Banc 1132 & 1141- 01/29/15)

RULE:
CTA EB DISAGREES. IT RULED THAT SECTION 4.110-3 DOES NOT
DISTINGUISH THE AMORTIZATION OF INPUT VAT IN CASE OF
REFUND OR IN CASE IT IS CREDITED AGAINST THE OUTPUT VAT.

THUS, OUT OF THE P1,797,810.08 INPUT VAT INCURRED BY NPDC


ON CAPITAL GOODS FOR THE THIRD QUARTER OF 2008, ONLY THE
AMOUNT OF P167,600.73 IS CREDITABLE FOR THE THIRD AND
FOURTH QUARTERS OF TAXABLE YEAR 2008.
D. REMEDIES
FLUOR DANIEL PHIL. INC. VS CIR
(G.R. 200620- 03/18/15)

FACTS:
• FLUOR DANIEL WAS INITIALLY ASSESSED FOR DEFICIENCY EWT
ON ITS SOSFTWARE MAINTENANCE FEES PAID TO AN
OFFSHORE AFFILIATE.

• IN RESPONSE TO PETITIONER’S PROTEST, THE CIR ISSUED A


FINAL DECISION ON DISPUTED ASSESSMENT (FDDA)
CANCELLING THE DEFICIENCY EWT ASSESSMENT BUT ISSUING
AN ASSESSMENT FOR FWT ON THE SAME SOFTWARE FEES
ALBEIT USING A LOWER 15% RATE UNDER THE RP-US TAX
TREATY.
FLUOR DANIEL PHIL. INC. VS CIR
(G.R. 200620- 03/18/15)

ISSUE:

WAS THE PETITIONER DEPRIVED OF DUE PROCESS


WHEN THE FDDA CHANGED THE ASSESSMENT FROM
DEFICIENCY EWT TO DEFICIENCY FWT?
FLUOR DANIEL PHIL. INC. VS CIR
(G.R. 200620- 03/18/15)

RULE:
YES. THE CHANGE OF THE ASSESSMENT IN THE FDDA ITSELF
CONSTITUTED A NEW ASSESSMENT.
AS SUCH, THE TAXPAYER SHOULD HAVE BEEN GIVEN THE CHANCE
TO DISPUTE THE SAME VIA THE PROCESS LAID DOWN IN THE TAX
CODE WHICH IS BY WAY OF FILING A PROTEST.
SINCE THIS WAS NOT COMPLIED WITH WHEN WHAT WAS ISSUED
WAS ALREADY AN FDDA.
THIS CERTAINLY DEPRIVED THE PETITIONER THE RIGHT TO BE
HEARD IN DEFENSE WHICH IS A CLEAR VIOLATION OF DUE
PROCESS OF LAW.
CHINA BANKING CORP. VS. CIR
(G.R. 172509- 02/04/15)

IN THIS CASE, THE ISSUE RAISED TO THE SUPREME COURT


WAS WHETHER THE FILING OF AN ANSWER IN THE CASE
FILED BEFORE THE CTA BY THE TAXPAYER BEING ASSESSED
BE CONSIDERED AS “COLLECTION” ON THE PART OF THE
BIR.
CHINA BANKING CORP. VS. CIR
(G.R. 172509- 02/04/15)

RULE:
IN PREVIOUS CASES, THE COURT UPHELD THE RULE THAT THE FILING
OF AN ANSWER BY THE CIR MAY CONSTITUTE THE “COLLECTION”
CONTEMPLATED BY LAW REQUIRED TO BE DONE WITHIN THE
PRESCRIBED PERIOD TO BE EFFECTIVE.
HOWEVER, IN THE ABOVE CASE, THE ANSWER WAS DEEMED
INEFFECTIVE SINCE THE CASE WAS FILED WITH THE CTA AT A TIME
WHICH WAS BEFORE THE EFFECTIVITY OF R.A. 9282 ON MARCH 2004
WHICH AMENDED R.A.1125 (COURT OF TAX APPEALS ACT).
UNDER THE OLD LAW, R.A. 1125, JUDICIAL ACTIONS FOR COLLECTION
OF INTERNAL REVENUE TAXES WAS STILL WITHIN THE JURISDICTION
OF THE REGULAR COURTS.
HENCE, THE RIGHT TO COLLECT HAD INDEED PRESCRIBED.
CHINA BANKING CORP. VS. CIR
(G.R. 172509- 02/04/15)

OTHER ISSUE:

MAY REQUEST FOR REINVESTIGATION BE GRANTED TO


TOLL PRESCRIPTIVE PERIOD?
CHINA BANKING CORP. VS. CIR
(G.R. 172509- 02/04/15)

RULE:
TWO THINGS MUST CONCUR TO SUSPEND THE PRESCRIPTIVE
PERIOD:
A. THERE MUST BE A REQUEST FOR REINVESTIGATION, AND
B. THE CIR MUST HAVE GRANTED IT.

IN THIS CASE, THERE WAS NO SHOWING FROM THE RECORDS


THAT THE CIR EVER GRANTED THE REQUEST FOR
REINVESTIGATION FILED BY THE TAXPAYER. HENCE, IT CANNOT BE
SAID THAT THE RUNNING OF THE PRESCRIPTIVE PERIOD WAS
EFFECTIVELY SUSPENDED.
CBK POWER CO. LTD. VS. CIR
(G.R. 193383-84 – 01/14/15)

FACTS:
• CBK POWER IS PRIMARILY ENGAGED IN THE DEVELOPMENT OF
HYDRO ELECTRIC POWER GENERATING PLANTS IN LAGUNA AND
DULY REGISTERED WITH BOI.
• TO FINANCE ITS PROJECTS, IT OBTAINED A SYNDICATED LOAN
FROM SEVERAL FOREIGN BANKS.
• IT WITHHELD FINAL TAXES FROM ITS INTEREST PAYMENTS TO
THESE BANKS BUT REALIZED LATER THAT THERE ARE
PREFERENTIAL RATES UNDER THE RELEVANT TAX TREATIES
ENTERED INTO BY THE PHILIPPINES WITH THE RESPECTIVE
COUNTRIES RESULTING IN OVER WITHHOLDING OF TAXES AND
ACCORDINGLY IT FILED CLAIM FOR ERRONEOUSLY WITHHELD
TAXES FO THE YEARS 2001 & 2002.
CBK POWER CO. LTD. VS. CIR
(G.R. 193383-84 – 01/14/15)

• DUE TO THE FAILURE TO SECURE A BIR INTERNATIONAL


TAX AFFAIRS DIVISION (ITAD) RULING RELATIVE TO ITS
CLAIM FOR REFUND, ITS CLAIM WAS DENIED BY THE CIR
AND AFFIRMED BY THE CTA. CBK APPEALED TO THE
SUPREME COURT.
CBK POWER CO. LTD. VS. CIR
(G.R. 193383-84 – 01/14/15)

RULE:
THE COURT RULED THAT CBK’S FAILURE TO COMPLY WITH THE
TAX TREATY RELIEF REQUIREMENT SHOULD NOT DEPRIVE IT OF
ITS TAX TREATY BENEFITS.

THE COURT CITED THE CASE OF DEUTSCHE BANK MANILA


BRANCH VS. CIR, AUG. 19, 2013 WHERE IT RULED THAT THE BIR
SHOULD NOT IMPOSE ADDITIONAL REQUIREMENTS THAT WOULD
NEGATE THE AVAILMENT OF THE RELIEFS PROVIDED FOR UNDER
INTERNATIONAL AGREEMENTS, ESPECIALLY SINCE THE TAX
TREATIES DO NOT PROVIDE FOR ANY PREREQUISITE AT ALL FOR
THE AVAILMENT OF THE BENEFITS.
CBK POWER CO. LTD. VS. CIR
(G.R. 193383-84 – 01/14/15)

THE COURT NOTED THAT THE TAXPAYER SHOULD NOT BE FAULTED


FOR NOT COMPLYING WITH PRIOR ITAD FILING RULING
REQUIREMENT SINCE IT COULD NOT HAVE APPLIED FOR A TAX
TREATY RELIEF PRECISELY BECAUSE IT ERRONEOUSLY PAID THE
TAX ON THE BASIS OF THE REGULAR RATE AS PRESCRIBED BY
THE TAX CODE.

AS STRESSED BY THE SUPREME COURT, THE PRIOR APPLICATION


REQUIREMENT UNDER REV. MEMORANDUM ORDER NO. 1-2000
THEN BECOMES ILLOGICAL.
PHILIPPINE NATIONAL BANK VS. CIR
(G.R. 206019 – 03/18/15)

FACTS:
• PHIL. NATIONAL BANK (PNB) MISTAKENLY WITHHELD AND
REMITTED TO THE CIR WITHHOLDING TAXES EQUIVALENT TO 6%
OF THE BID PRICE OF FORECLOSED REAL PROPERTIES,
INSTEAD OF ONLY 5% EXPANDED WITHHOLDING TAX (EWT) ON
SALES OF ORDINARY ASSETS.

• PNB FILED A CLAIM FOR REFUND AND IN SUPPORT OF ITS


CLAIM, PNB PRESENTED EVIDENCE TO SHOW THAT THE
DEVELOPER HAD NOT UTILIZED THE WITHHELD TAXES, NAMELY:
PHILIPPINE NATIONAL BANK VS. CIR
(G.R. 206019 – 03/18/15)

A. DEVELOPER CORP.’S AUDITED FINANCIAL STATEMENT


REFLECTING THE MORTGAGED PROPERTY AS INCLUDED IN
THE ASSET ACCT. “PROPERTIES & EQUIPMENT”;

B. DEVELOPER CORP.’S ITR SHOWING THAT THE EXCESS EWT


CLAIMED FOR REFUND HAD NEVER BEEN UTILIZED;

C. TESTIMONY OF THE DEVELOPER CORP.’S ACCOUNTANT THAT


THE AMOUNT, SUBJECT OF THE BANK’S CLAIM FOR REFUND,
WAS NOT INCLUDED AMONG THE CWT STATED IN THE
DEVELOPER CORP.’S ITR.
PHILIPPINE NATIONAL BANK VS. CIR
(G.R. 206019 – 03/18/15)

RULE:
THE COURT GRANTED THE REFUND OF THE EXCESS 1% EWT FOR THE
FOLLOWING REASONS:
A. THE DEVELOPER CORP. NEVER UTILIZED THE EWT CERTIFICATE
AS TAX CREDIT;
B. BECAUSE THE DEVELOPER CONTESTED THE VALIDITY OF THE
FORECLOSURE SALE VIA LITIGATION, IT DID NOT RECOGNIZE THE
FORECLOSURE SALE AND THE EWT WITHHELD FROM THE
SELLING PRICE;
C. THE DEVELOPER CONTINUES TO RECOGNIZE THE LAND AS ITS
ASSET BY REFLECTING THE MORTGAGED PROPERTY IN ITS
FINANCIAL STATEMENTS AND IT NEVER INCLUDED THE EWT IN ITS
INCOME TAX RETURN.
COCA-COLA BOTTLERS PHIL. INC. VS. CIR
(CTA En Banc 1044 – 02/12/15)

FACTS:
• PETITIONER IS A VAT-REGISTERED TAXPAYER.
• ITS ACCTG. PRACTICE CONCERNING PURCHASES OF SERVICES
ON CREDIT IS TO CHARGE THE INPUT TAX IN A TEMPORARY
ACCT. UPON RECEIPT OF THE INVOICE.
• WHEN PETITIONER PAYS FOR THE ACCT., THE INPUT TAX IS THEN
TRANSFERRED TO INPUT TAX SERVICE ACCT. WHICH IS LATER
ON CLOSED TO OUTPUT TAX PAYABLE AT THE END OF THE
QUARTER.
• DUE TO INADVERTENCE, THE INPUT TAX ON SERVERAL
PURCHASES ON CREDIT WERE NOT TRANSFERRED TO INPUT
TAX-SERVICE ACCT. AND HENCE NOT DECLARED IN ITS
QUARTERLY VAT RETURN.
COCA-COLA BOTTLERS PHIL. INC. VS. CIR
(CTA En Banc 1044 – 02/12/15)

SINCE A LETTER OF AUTHORITY (LOA) HAVE ALREADY BEEN ISSUED


BY THE BIR, PETITIONER COULD NOT AMEND ITS VAT RETURNS
ANYMORE WHEN THE ERROR WAS DISCOVERED.

PETITIONER FILED AN APPLICATION FOR TAX REFUND FOR OVER


ERRONEOUS PAYMENT OF VAT ARISING FROM THE
UNDERSTATEMENT OF INPUT VAT.

THEREAFTER, PETITIONER FILED ITS JUDICIAL CLAIM WHICH WAS


DENIED BY THE CTA IN DIVISION.

PETITIONER FILED ITS MOTION FOR RECONSIDERATION WHICH


WAS ALSO DENIED BY THE CTA IN DIVISION.
COCA-COLA BOTTLERS PHIL. INC. VS. CIR
(CTA En Banc 1044 – 02/12/15)

ISSUE:

IS THE DECISION OF THE CTA IN DIVISION TENABLE?


COCA-COLA BOTTLERS PHIL. INC. VS. CIR
(CTA En Banc 1044 – 02/12/15)

RULE:
THE CTA EN BANC AFFIRMED THE RESOLUTION OF THE CTA IN DIVISION
FOR THE FOLLOWING REASONS:
A) ONLY INPUT TAX DECLARED IN THE VAT RETURN IS CONSIDERED
FOR CREDIT AGAINST THE OUTPUT TAX ON THE SAME TAXABLE
YEAR PURSUANT TO SEC. 110(A)(2) AND (B) OF THE NIRC;
B) FACTS SHOW THAT PETITIONER DOES NOT HAVE ENOUGH INPUT
TAXES TO OFFSET ITS OUTPUT TAXES FOR THE SAME PERIOD;
C) THERE ARE ONLY TWO INSTANCES IN SEC. 112 WHEN EXCESS INPUT
TAX MAY BE CLAIMED:
1. WHEN ATTRIBUTABLE TO ZERO-RATED SALES; AND
2. UPON CANCELLATION OF VAT REGISTRATION DUE TO CESSATION
OF BUSINESS WHICH DOES NOT APPLY TO PETITIONER.
CIR VS. PHILEX MINING CORP.,
(CTA En Banc 1097 – 02/17/15)

FACTS:
• PHILEX, A ZERO RATED TAXPAYER FILED WITH THE CIR A CLAIM FOR
REFUND OF INPUT VAT ON ITS PURCHASES OF SERVICES.
• DUE TO INACTION OF CIR, PHILEX FILED A PETITION FOR REVIEW
WITH THE CTA DIVISION.
• BIR FILED A MOTION TO DISMISS CLAIMING THAT JUDICIAL CLAIM
FOR REFUND WAS FILED BEYOND THE 2-YEAR PRESCRIPTIVE
PERIOD.
• IN RESPONSE PHILEX ARGUED THAT THE LAW APPLIES ALSO TO
ADMINISTRATIVE CLAIM FOR REFUND.
• CTA DIVISION DENIED BIR’S MOTION TO DISMISS FOR LACK OF
MERIT.
• CTA DIVISION PARTIALLY GRANTED PHILEX’S CLAIM FOR REFUND.
• BIR FILED A MOTION FOR PARTIAL RECONSIDERATION WHICH WAS
DENIED BY THE CTA DIVISION.
CIR VS. PHILEX MINING CORP.,
(CTA En Banc 1097 – 02/17/15)

RULE:
A PERUSAL OF THE EXHIBITS SHOWS THAT THE AMOUNT OF INPUT
TAX BEING CLAIMED WAS ALREADY DEDUCTED FROM THE CLAIM
OF PHILEX GRANTED BY THE CTA DIVISION.
BIR ARGUED THAT PHILEX’S CLAIM FOR REFUND INCLUDES
TRANSACTIONS OUTSIDE THE PERIOD COVERED BUT FAILED TO
CITE A SINGLE TRANSACTION.
CTA DIVISION ALSO EXCLUDED THE AMOUNT WHICH DOES NOT
HAVE SUPPORTING BUREAU OF CUSTOMS OR BANK OFFICIAL
RECEIPTS AND VAT OFFICIAL RECEIPTS.
CIR’S BARE ALLEGATIONS UNSUBSTANTIATED BY EVIDENCE ARE
NOT EQUIVALENT TO PROOF. HENCE, THERE IS NO REASON TO
DISTURB THE FINDINGS OF THE CTA DIVISION.
DEUTCHE KNOWLEDGE SERVICES PTE. LTD.
VS. CIR
(CTA En Banc 1145 – 02/18/15)

FACTS:
• PETITIONER, A REGISTERED VAT TAXPAYER HAS A REGIONAL
OPERATING HEADQUARTERS IN THE PHILIPPINES.
• IN 2007, 4TH QUARTER, PETITIONER RENDERED SERVICES IN THE
PHILIPPINES TO PERSONS DOING BUSINESS IN THE PHILIPPINES,
PAYMENTS OF WHICH WERE MADE IN FOREIGN CURRENCIES
WITH THE BSP.
• ON NOV. 9, 2009, PETITIONER FILED A REFUND CLAIM FOR
UNUTILIZED/ EXCESS INPUT VAT ATTRIBUTABLE TO ZERO RATED
SALES BUT DUE TO INACTION OF CIR, A PETITION FOR REVIEW
WAS FILED WITH CTA DIVISION WHICH WAS DENIED AND LATER A
MOTION FOR RECONSIDERATION WITH THE CTA DIVISION WAS
LIKEWISE DENIED FOR LACK OF MERIT.
DEUTCHE KNOWLEDGE SERVICES PTE. LTD.
VS. CIR
(CTA En Banc 1145 – 02/18/15)

RULE:
CTA EN BANC RULED THAT THE CTA DIV. ALREADY FULLY
EXHAUSTED THE ISSUES RAISED BY PETITIONER AND NO NEW
MATTERS WERE RAISED AND DENIED THE INSTANT PETITION FOR
THE FOLLOWING REASONS:
A. PETITIONER FAILED TO COMPLY WITH THE REQUIREMENTS
UNDER RMO 53-98;
B. FAILURE TO SUBMIT PROOF THAT IT RENDERED SERVICES TO
PERSONS ENGAGED IN BUSINESS OUTSIDE THE PHIL. AND
FOREIGN EXCHANGE WAS REMITTED TO THE BSP.
C. PETITIONER FILED ITS JUDICIAL CLAIM FOR REFUND LESS THAN
120 DAYS AFTER THE FILING OF THE ADMINISTRATIVE CLAIM
PRESCRIBED UNDER SEC. 112(D) OF THE TAX CODE AND
THEREFORE JUDICIAL CLAIM WAS FILED PREMATURELY.
CIR VS. NAGASE PHIL. CORP.
(CTA En Banc 1048 – 01/29/15)

FACTS:
• NAGASE FILED ITS INCOME TAX RETURN FOR TAXABLE YEAR 2003
ON APRIL 14, 2004.
• IT RECEIVED FROM CIR A FORMAL ASSESSMENT NOTICE (FAN DATED
SEPT. 13, 2007.
• ON OCT. 10, 2007, NAGASE FILED ITS PROTEST TO THE FAN AND
RECEIVED BY CIR ON OCT. 11, 2007.
• IN ITS PROTEST, NAGASE REQUESTED THAT THE ASSESSMENT BE
RECONSIDERED AND CANCELLED.
• IN MAY 2008, NAGASE FILED A PETITION FOR REVIEW WITH CTA
DIVISION WHICH CANCELLED THE ASSESSMENT.
• CIR APPEALED TO CTA EB AND ARGUED THAT NAGASE REQUESTED
FOR REINVESTIGATION WHICH LED TO THE ISSUANCE OF THE FAN
ONLY ON SEPT. 12, 2007.
CIR VS. NAGASE PHIL. CORP.
(CTA En Banc 1048 – 01/29/15)

RULE:
THE CTA EB RULED THAT WHAT WAS REQUESTED BY NAGASE WAS A
RECONSIDERATION OF THE ASSESSMENT AND NOT A
REINVESTIGATION.
THE CTA EB CITED THE CASE OF CIR VS. PHIL. GLOBAL
COMMUNICATION [G.R. 167146, OCT. 31, 2006] WHICH DIFFERENTIATED
BETWEEN A “RECONSIDERATION” AND A “REINVESTIGATION.”
A. REQUEST FOR RECONSIDERATION – REFERS TO A PLEA FOR A RE-
EVALUATION OF AN ASSESSMENT ON THE BASIS OF EXISTING
RECORDS WITHOUT NEED OF ADDITIONAL EVIDENCE. IT MAY
INVOLVE BOTH A QUESTION OF FACT OR LAW OR BOTH. THIS DOES
NOT TOLL THE RUNNING OF PRESCIPTIVE PERIOD FOR COLLECTION
OF AN ASSESSED TAX.
CIR VS. NAGASE PHIL. CORP.
(CTA En Banc 1048 – 01/29/15)

RULE:
B. REQUEST FOR REINVESTIGATION REFERS TO A PLEA FOR RE-
EVALUATION OF AN ASSESSMENT ON THE BASIS OF NEWLY-
DISCOVERED EVIDENCE THAT A TAXPAYER INTENDS TO
PRESENT IN THE INVESTIGATION. IT MAY ALSO INVOLVE BOTH
A QUESTION OF FACT OR LAW OR BOTH. THIS SUSPENDS THE
RUNNING OF THE PRESCRIPTIVE PERIOD.

CTA EB RULED THAT SINCE IT WAS CLEAR THAT WHAT WAS


REQUESTED BY THE TAXPAYER IS A “RECONSIDERATION”, THIS DID
NOT TOLL THE PRESCRIPTIVE PERIOD TO ASSESS AND THE CIR’S
RIGHT TO ASSESS HAD ALREADY PRESCRIBED.
CIR VS. NAGASE PHIL. CORP.
(CTA En Banc 1048 – 01/29/15)

RULE:
IN THIS CASE CIR ARGUED THAT NAGASE REQUESTED FOR
REINVESTIGATION AND IT WAS THIS REINVESTIGATION WHICH LEAD
TO THE ISSUANCE OF THE FAN ONLY ON SEPT. 12, 2007.
HOWEVER, CIR FAILED TO PROVE THE SAME. THE PAN AND
NAGASE’S PROTEST TO THE PAN WERE NOT PREENTED IN
EVIDENCE.
THE RECORD SHOWS THAT NAGASE’S PROTOEST LETTER TO THE
FAN WHICH READS IN PART “NAGASE RECEIVED YOUR FAN ON
SEPT. 13, 2007 OR MORE THAN 3 YEARS FROM AND AFTER APRIL
15, 2004”.
THUS, THE ASSESSMENT MADE BY THE CIR IS VOID FOR BEING
FILED OUT OF TIME.
CIR VS. NAGASE PHIL. CORP.
(CTA En Banc 1048 – 01/29/15)

RULE:
ANOTHER ISSUE RAISED IN THIS CASE IS WHETHER THE PETITION
WAS FILED WITHIN THE PRESCRIPTION PERIOD.
RECORDS SHOW THAT ON JULY 19, 2013, THE CIR RECEIVED THE
RESOLUTION DENYING THE MOTION FOR RECONSIDERATION.
THUS, IT HAS UNTIL AUGUST 3, 2013 TO FILE AN APPEAL BEFORE
THE COURT.
ON JULY 31, 2013, THE CIR FILED A MOTION FOR EXTENSION OF
TIME TO FILE THE INSTANT PETITION FROM AUGUST 3, 2013 OR
UNTIL AUGUST 18, 2013.
AUG 18, 2013 WAS A SUNDAY.
CIR VS. NAGASE PHIL. CORP.
(CTA En Banc 1048 – 01/29/15)

RULE:
THE NEXT CALENDAR DAYS, AUGUST 19 & 20 WERE DECLARED
NON-WORKING DAYS DUE TO A TYPHOON WHILE AUGUST 21, 2013
WAS A LEGAL HOLIDAY.

HENCE, THE LAST DAY FOR THE FILING OF THE PETITION WAS ON
AUGUST 22, 2013.

THE CIR FILED, THROUGH REGISTERED MAIL, THE INSTANCE


PETITION ON AUGUST 22, 2013.

THUS, IN CASE THE FINAL DAY FOR FILING FALLS ON A NON-


WORKING DAY, OR A HOLIDAY, THE NEXT FOLLOWING WORKING
DAY WOULD BE THE LAST DAY.
CIR VS. FABTECH EXPORT INDUSTRIES INC.
(CTA En Banc 1176- 01/28/15)

FACTS:
• THOUGH CIR ALLEGED THAT A PAN WAS SENT THROUGH
REGISTERED MAIL, IT FAILED TO PRESENT EVIDENCE TO PROVE
ITS EXISTENCE AND THE DUE ISSUANCE AND RECEIPT OF THE
ALLEGED PAN BY PETITIONER.
• CIR MERELY ATTACHED AN ALLEGED PHOTOCOPY OF THE PAN
AND AN ALLEGED MAILING ENVELOPE CONTANING THE SAID PAN
TO THE PETITION FOR REVIEW WITH CTA DIVISION.
• PETITIONER PRAYED TO THE CTA THAT IT SHOULD NOT
CONSIDER ANY EVIDENCE WHICH HAS NOT BEEN FORMALLY
OFFERED.
• MOREOVER, THE ISSUANCE OF THE FINAL LETTER OF DEMAND
(FLD) VIOLATED PETITIONER’S RIGHT TO DUE PROCESS.
CIR VS. FABTECH EXPORT INDUSTRIES INC.
(CTA En Banc 1176- 01/28/15)

RULE:
• CTA EB CANNOT GIVE PROBATIVE VALUE TO THE ALLEGED
PAN AND MAILING ENVELOPE ATTACHED TO THE PETITION
FOR REVIEW SINCE THE SAME WERE NOT FORMALLY
OFFERED DURING THE TRIAL.
• A PERUSAL OF THE BIR RECORD SHOWS THAT THE
ORIGINAL COPY OF THE MAILING ENVELOPE IS TUCKED
INSIDE THE FOLDER, STILL SEALED AND UNOPENED.
• THIS CLEARLY SHOWS THAT THE PAN DATED FEB. 25, 2011
CONTAINED INSIDE THE ENVELOPE WAS NOT RECEIVED BY
THE PETITIONER.
• IN THE ABSENCE OF A VALID PAN, PETITIONER’S RIGHT TO
DUE PROCESS WAS VIOLATED, RENDERING THE
ASSESSMENT NULL AND VOID.
Lear Automotive Services (Netherlands)
B.V. – Phil. Branch vs. CIR
(CTA 8421 & 8561- 05/21/15)
FACTS:
• CIR assessed Lear Automotive Services (Netherlands) B.V. Phil. Branch
(Lear-PH) for deficiency income tax for taxable years 2007 and 2008 arising
from the disallowance of royalty expenses from Lear-PH’s gross income
subject to the 5% tax.
• Lear-PH, a PEZA-registered entity, protested and argued that the royalty
fees paid to Lear Automotive Services (Netherlands) B.V. (Lear-BV) for the
use of intangible property required for its manufacturing activity, form part of
its direct costs and are deductible from gross income.
• Lear-PH also argued that it had previously secured BIR Ruling No. DA 147-
2005 which confirmed that the said royalty payments are part of the cost of
finished goods; hence, are deductible for purposed of computing the 5%
income tax.
• The CIR claimed that BIR Ruling No. DA 147-2005 cannot be enforced as it
misapplied the PEZA Law and RR No. 11-2005.
Lear Automotive Services (Netherlands)
B.V. – Phil. Branch vs. CIR
(CTA 8421 & 8561- 05/21/15)

ISSUE:

Can the CIR unilaterally set aside BIR Ruling No. DA


147-2005 by issuing a deficiency assessment?
Lear Automotive Services (Netherlands)
B.V. – Phil. Branch vs. CIR
(CTA 8421 & 8561- 05/21/15)

RULE:
No. The CIR cannot adopt a position contrary to previously issued tax
exemption ruling by simply issuing an assessment against a taxpayer.

To allow this would cause undue prejudice to Lear-PH which merely relied
in good faith on the BIR Ruling.

BIR Ruling DA-147-2005 is binding to the CIR. Under Sec. 246 of the Tax
Code, the CIR is precluded from adopting a position contrary to one
previously taken if it results in injustice to the taxpayer.
BASES CONVERSION AND DEV. AUTHORITY
VS. CIR
(CTA En Banc 1102- 01/07/15)

FACTS:
• IN THIS CASE, CIR ISSUED AN ADVERSE DECISION ON BCDA’S
ADMINISTRATIVE CLAIM FOR REFUND WHICH WAS RECEIVED BY
THE LATTER ON APRIL 3, 2012.

• BCDA HAS UNTIL MAY 3, 2012 WITHIN WHICH TO APPEAL THE


DECISION FOLLOWING THE 30-DAY APPEAL PERIOD UNDER R.A.
1125, AS AMENDED BY R.A. 9282.

• THE PETITION FOR REVIEW BEFORE THE CTA DIVISION WAS


FILED ONLY ON MAY 10, 2012 OR 7 DAYS AFTER THE 30-DAY
PERIOD TO FILE AN APPEAL.

• CTA DIVISION DISMISSED THE APPEAL.


BASES CONVERSION AND DEV. AUTHORITY
VS. CIR
(CTA En Banc 1102- 01/07/15)

RULE:
THE DISMISSAL WAS VALID.

JURISPRUDENCE HAS REPEATEDLY RECOGNIZED THE MANDATORY


CHARACTER OF THE 30-DAY PERIOD WITHIN WHICH TO FILE AN
APPEAL BEFORE THE CTA.

IT IS STRESSED THAT A CLAIM FOR REFUND CAN PROCEED ONLY


UPON COMPLIANCE WITH THE JURISDICTIONAL REQUIREMENT.
M+W PHIL. INC. VS. CIR
(CTA En Banc 1056- 01/07/15)

FACTS:
• PETITIONER FILED ITS QUARTERLY VAT RETURNS FOR THE FOUR
QUARTERS OF 2009 WITH THE CIR.

• HOWEVER, THE CIR DENIED ITS CLAIM FOR TAX REFUND OF


UNUTILIZED INPUT TAXES DUE TO THE FACT THAT IT FAILED TO
SUBMIT IS VAT RETURNS FOR THE SUCCEEDING QUARTER OF
2010 AS WELL AS FAILURE TO SUBSTANTIATE ITS CLAIM.

• CTA DIVISION AFFIRMED BIR’S DENIAL OF THE CLAIM.


M+W PHIL. INC. VS. CIR
(CTA En Banc 1056- 01/07/15)

RULE:
CTA EB AFFIRMED THE DECISION OF CTA DIVISION BECAUSE IT
STATED THAT THE VAT RETURNS FOR THE SUCCEEDING QUARTERS
ARE NECESSARY IN ORDER TO VERIFY WITH CERTAINTY WHETHER
THE CLAIMED INPUT VAT WAS CARRIED OVER OR APPLIED AGAINST
ANY OUTPUT VAT IN 2010 OR IN THE SUCCEEDING QUARTERS.
M+W PHIL. INC. VS. CIR
(CTA En Banc 1056- 01/07/15)

ISSUE:
ANOTHER ISSUE IN THIS CASE WAS THE ATTEMPT OF PETITIONER
TO SUBMIT FOR THE FIRST TIME ON APPEAL THE QUARTERLY VAT
RETURNS FOR THE FOUR QUARTERS OF 2010 WHICH WERE NOT
PRESENTED AND FORMALLY OFFERED IN EVIDENCE DURING THE
TRIAL.

MAY THE EVIDENCE BE ADMITTED AT THIS POINT BY THE COURT


EN BANC?
M+W PHIL. INC. VS. CIR
(CTA En Banc 1056- 01/07/15)

RULE:
NO. SAID DOCUMENTS ARE CONSIDERED “FORGOTTEN EVIDENCE”
WHICH CANNOT BE LEGALLY CONSIDERED AND ADMITTED AS
EVIDENCE DURING THE TRIAL SINCE THESE EVIDENCES COULD
NOT BE CONSIDERED AS ‘NEWLY DISCOVERED EVIDENCE’, BUT
MERE ‘FORGOTTEN EVIDENCE” WHICH DO NOT JUSTIFY A
REOPENING OF THE CASE.
CIR VS. ALPHA RIGGING & MOVING
SYSTEMS INC.
(CTA En Banc 1076 – 01/08/15)

FACTS:
CIR IN AN APPEAL TO CTA EB CLAIMS THAT AN ACTION TO
CHALLENGE COLLECTION PROCEDURES ON FINAL AND
EXECUTORY ASSESSMENTS SHOULD BE LIMITED ONLY TO
COLLECTION PROCEDURE AND THAT THE VALIDITY OF
ASSESSMENT IS A SEPARATE AND DISTINCT ISSUE THAT CAN NO
LONGER BE QUESTIONED.
CIR VS. ALPHA RIGGING & MOVING
SYSTEMS INC.
(CTA En Banc 1076 – 01/08/15)

ISSUE:

IS THE CIR’S POSITION TENABLE?


CIR VS. ALPHA RIGGING & MOVING
SYSTEMS INC.
(CTA En Banc 1076 – 01/08/15)
RULE:
CTA EB DISAGREES. AS PROVIDED BY SEC. 7(a)(1) OF R.A. 1125, AN
ACT CREATING THE COURT OF TAX APPEALS, THE JURISDICTION
FO THE CTA OVER “OTHER MATTERS ARSING UNDER THE NIRC OR
OTHER LAWS OR PART OF LAW ADMINISTERED BY THE BIR” IS NOT
LIMITED TO THE TIMELINESS AND VALIDITY OF THE COLLECTION
PROCEDURE ITSELF.
HENCE, THE COURT CAN STILL LOOK INTO THE VALIDITY OF THE
ASSESSMENT.
CLEARLY, A VOID ASSESSMENT BEARS NO FRUIT AND A WARRANT
OF DISTRAINTAND/OR LEVY ISSUED PURSUANT TO A VOID
ASSESSMENT IS LIKEWISE NULL AND VOID.
E. LOCAL AND REAL PROPERTY TAXES
MACTAN-CEBU INT’L AIRPORT AUTHORITY VS.
LAPU-LAPU CITY
(G.R. 181756 – 06/15/15)

ISSUE:

ARE THE REAL PROPERTY OF MACTAN-CEBU INT’L


AIRPORT AUTHORITY SUBJECT TO REAL PROPERTY
TAX?
MACTAN-CEBU INT’L AIRPORT AUTHORITY VS.
LAPU-LAPU CITY
(G.R. 181756 – 06/15/15)

RULE:
NO. PETITIONER IS AN INSTRUMENTALITY OF THE GOVT. AND THUS
ITS PROPERTIES ACTUALLY, SOLELY, AND EXCLUSVIELY USED FOR
PUBLIC PURPOSES CONSISTING OF THE AIRPORT TERMINAL BLDG.,
AIRFIELD, RUNWAY, TAXIWAY, AND THE LOTS IN WHICH THEY ARE
SITUATED ARE EXEMPT FROM RPT.
MACTAN-CEBU INT’L AIRPORT AUTHORITY VS.
LAPU-LAPU CITY
(G.R. 181756 – 06/15/15)

RULE:
THE DECISION FOLLOWS THE 2006 MIAA CASE AND NOT THE 1996
MCIAA CASE.
THE COURT REITERATED THAT MIAA/ MCIAA IS NOT A GOCC (AS IT
IS NOT ORGANIZED AS A STOCK OR NON-STOCK CORPORATION)
BUT A GOVT.
INSTRUMENTALITY VESTED WITH CORPORATE POWERS.
AS PROPERTIES OF PUBLIC DOMINION BEING FOR PUBLIC USE,
THE PROPERTIES OF MCIAA ARE NOT SUBJECT TO LEVY,
ENCUMBRANCE, OR DISPOSITION.
THE CASE LIKEWISE CITED THE PREVIOUS RULINGS IN THE PFDA,
GSIS, AND PPA CASES.
DEMAALA VS. COMM. ON AUDIT
(G.R. 199752 –02/17/15)

ISSUE:

CAN AN LGU IMPOSE AND COLLECT A SPECIAL


EDUCATION FUND AT LESS THAN 1%?
DEMAALA VS. COMM. ON AUDIT
(G.R. 199752 –02/17/15)

RULE:
YES. THE IMPOSITION OF THE SEF IS WITHIN THE TAXING POWER
OF LOCAL GOVT. UNITS AND WHICH IS CONSISTENT WITH THE
GUIDING CONSTITUTIONAL PRINCIPLE OF LOCAL AUTONOMY AND
FISCAL FLEXIBILITY.

THE PERMISSIVE LANGUAGE (USE OF THE TERM “MAY”) OF THE


LGC PROVISION IMPOSING THE SEF SUPPORTS THE AUTHORITY OF
THE LGU’S TO PRESCRIBE THEIR OWN RATES AND THAT THE 1% IS
A MAXIMUM RATE RATHER THAN AN IMMUTABLE EDICT.
CITY OF MAKATI VS. TRANS-ASIA POWER
GENERATION CORP.
(CTA En Banc 1086 - 01/21/15)
FACTS:
• TRANS ASIA IS ENGAGED IN THE BUSINESS OF BUILDING,
ERECTING OWNING, OPERATING, SELLING AND LEASING POWER
GENERATION PLANTS AND PURCHASING, IMPORTING, AND
LEASING TELECOMMUNICATION AND OTHER KINDS OF
EQUIPMENT.
• FOR THE YEARS 1996 TO 2005, MAKATI CITY CLASSIFIED TRANS
ASIA AS A “MANUFACTURER/ PRODUCER” FOR LOCAL BUSINESS
TAX (LBT) PURPOSES.
• IN 2006, MAKATI CITY CHANGED ITS CLASSIFICATION TO
“SERVICES-OTHER CONTRACTOR” WHICH RESULTED IN
INCREASE OF LBT PAYMENTS WHICH IT PAID UNDER PROTEST
AND FILED A CLAIM FOR REFUND.
CITY OF MAKATI VS. TRANS-ASIA POWER
GENERATION CORP.
(CTA En Banc 1086 - 01/21/15)

FACTS:
• RTC MAKATI RULED THAT TRANS ASIA IS A “MANUFACTURER/
PRODUCER” SINCE IT IS ENGAGED IN THE BUSINESS OF
TRANSFORMING FUEL INTO ELECTRICITY AND SELLING TO END-
USER.

• THIS RULING WAS AFFIRMED BY THE CTA DIVISION PROMPTING


MAKATI CITY TO APPEAL TO CTA EN BANC.
CITY OF MAKATI VS. TRANS-ASIA POWER
GENERATION CORP.
(CTA En Banc 1086 - 01/21/15)
RULE:
• TRANS ASIA IS A “MANUFACTURER/ PRODUCER” AND NOT A
“CONTRACTOR”.
• IT BUYS BUNKER FUEL AS ITS CHIEF RAW MATERIAL AND CONVERTS
IT THROUGH CHEMICAL PROCESSES TO ELECTRICITY.
• THEN IT SELLS ELECTRICITY TO HI-CEMENT.
• WHILE HI-CEMENT INITIALLY OWNED THE POWER PLANT, THE SAME
WAS LATER SOLD TO TRANS ASIA. AS THE OWNER OF THE POWER
PLANT, TRANS ASIA NEED TO OPERATE THE POWER PLANT FOR A
FEE.
• ITS RECEIPT OF THIS FEE DOES NOT MAKE IT A “CONTRACTOR”.
• THE ADDITIONAL UNDERTAKINGS ARE MERELY IN AID OF ITS
PRIMARY FUNCTION AS A PRODUCER OF ELECTRICITY AND ARE NOT
CONSIDERED AS SERVICES RENDERED.
NATIONAL GRID CORP. OF THE PHIL. VS.
CBAA, LBAA OF CABANATUAN
(CTA En Banc 1052 - 01/28/15)
FACTS:
• TAXPAYER IS NOT A GOCC BUT A PRIVATELY OWNED CORP. AND
IS ENGAGED IN THE TRANSMISSION OF ELECTRICITY ONLY AND
NOT IN THE GENERATION THEREOF AND THEREFORE SHOULD BE
EXEMPTED FROM RPT.

• IT ALLEGES THAT THE USE OF THE CONJUNCTIVE WORD “AND”


UNDER SEC. 234 OF THE REAL PROPERTY TAX CODE SHOWS THE
INTENT OF THE LAW IN GRANTING EXEMPTION FROM REAL
PROPERTY TAX.

• TAXPAYER ALLEGES THAT IF THE PROPERTIES ARE NOT EXEMPT


FROM RPT ALTERNATIVELY, IT MUST BE CLASSIFIED AS “SPECIAL
CLASS.”
NATIONAL GRID CORP. OF THE PHIL. VS.
CBAA, LBAA OF CABANATUAN
(CTA En Banc 1052 - 01/28/15)

RULE:
CTA EB DISAGREES.

IN ORDER TO AVAIL OF THE SPECIAL TAX RATE, IT MUST BE A GOCC


ENGAGED IN THE GENERATION AND TRANSMISSION OF ELECTRIC
POWER.

THE USE OF THE CONJUNCTIVE WORD “AND” SHOWS THE INTENT


OF THE LAW THAT IN ORDER TO GRANT TAX EXEMPTION OR TO
AVAIL OF THE SPECIAL TAX RATE OF 10%, IT MUST BE A GOCC
ENGAGED IN THE GENERATION AND TRANSMISSION OF ELECTRIC
POWER.
F. CUSTOMS CASES
COMM. OF CUSTOMS VS. DOLE PHIL. INC.
(CTA En Banc 1142- 01/5/15)

FACTS:
• DOLE FAILED TO FILE A NOTICE OF APPEAL WITH THE OFFICE OF
THE DISTRICT COLLECTOR AS WELL AS PAY THE APPEAL FEE
WITHIN THE REGLEMENTARY PERIOD AS PROVIDED IN THE
TARIFF & CUSTOMS CODE (TCCP).

• FOR THIS REASON, THE COMM. OF CUSTOMS DISMISSED ITS


APPEAL AND DENY THE DUTY REFUND CLAIM OF DOLE.

• THE REFUND CLAIM REPRESENTS CUSTOMS DUTIES ON


PETROLEUM PRODUCT WHICH DOLE PURCHASED FROM PETRON
CORPORATION.
COMM. OF CUSTOMS VS. DOLE PHIL. INC.
(CTA En Banc 1142- 01/5/15)

FACTS:
• CTA EB IN RULING ON THE ISSUE APPLIED THE DECISION OF THE
SUPREME COURT IN THE CASE OF COMM. OF CUSTOMS VS.
PHILIPPINE PHOSPATE FERTILIZER CORP. (G.R.144440, 9/1/2004)
WHICH PROVIDES THAT THE PRESCRIPTIVE PERIODS UNDER THE
TCCP AND OTHER REVENUE LAWS ARE INAPPLICABLE ON CLAIMS
FOR REFUND OF PASSED-ON CUSTOMS DUTIES ARISING FROM
PURCHASES OF SUPPLIES BROUGHT INTO THE ECOZONE AND USED
BY A DULY-REGISTERED PEZA ENTERPRISE AND THAT THE
PRESCRIPTIVE PERIODS UNDER THE TCCP SHOULD NOT BAR THE
CLAIM FOR REFUND.
• THE PRESCRIPTIVE PERIOD COMMENCED WITHIN 6 YEARS FROM
THE DATE OF PAYMENT PURSUANT TO SEC. 1145(2) OF THE NEW
CIVIL CODE.
G. DOCUMENTARY STAMP TAX
CIR VS. TRADERS ROYAL BANK
(G.R. 167134 - 03/18/15)

FACTS:
• TRADERS ROYAL BANK (TRB), A COMMERCIAL BANK WAS
ASSESSED BY THE CIR FOR DEFICIENCY DST ON ITS SPECIAL
SAVINGS DEPOSIT, MEGA SAVINGS DEPOSIT AND TRUST FUND.
• TRB ARGUED THAT THESE INSTRUMENTS ARE NOT SUBJECT TO
DST WHICH WAS THE SAME ARGUMENT BEING INVOKED BY
OTHER BANKS USING SIMILAR INSTRUMENTS AND THE
IMPOSITION OF THE DST IS CONSIDERED AS AN INDUSTRY
PROBLEM CONTESTED BY THE ENTIRE BANKING INDUSTRY.
• CIR CONTENDED THAT UNDER SEC. 180 OF THE NIRC, THE
SPECIAL SAVINGS DEPOSIT ARE SUBJECT TO THE DST.
• CIR ALSO OPINED THAT THE TRUST INDENTURE AGREEMENT IS
BUT A FORM OF DEPOSIT AND LIKEWISE SUBJECT TO DST.
CIR VS. TRADERS ROYAL BANK
(G.R. 167134 - 03/18/15)

FACTS:
• THE CTA DIVISION AGREED WITH THE BIR THAT THE SPECIAL
SAVINGS DEPOSIT ARE SUBJECT TO DST BUT CONCURRED WITH
TRB THAT THE TRUST INDENTURE AGREEMENT ARE DIFFERENT
FROM CERTIFICATE OF DEPOSIT AND HENCE NOT SUBJECT TO
DST.
• CTA EN BANC AFFIRMED THE DECISION OF THE CTA DIVISION
PROMPTING THE CIR TO APPEAL TO THE SUPREME COURT.
• CIR INSISTS THAT THE TRUST INDENTURE AGREEMENTS
BETWEEN THE TRB AND ITS CLIENTS WERE SIMPLE LOANS AND
THE RELATIONSHIP BETWEEN TRB AND ITS CLIENTS WAS THAT
OF DEBTOR-CREDITOR SIMILAR TO CERTIFICATES OF DEPOSIT
AND THEREFORE SUBJECT TO DST UNDER SEC. 180 OF NIRC.
CIR VS. TRADERS ROYAL BANK
(G.R. 167134 - 03/18/15)

ISSUE:

ARE THE SAID TRUST INDENTURE AGREEMENTS


CONSIDERED DEPOSITS OR TRUSTS?
BIR POSITS THAT THESE ARE DEPOSITS SUBJECT TO
DST, WHILE TRB PROFFERS THAT THE SAME WERE
TRUSTS EXEMPT FROM DST.
CIR VS. TRADERS ROYAL BANK
(G.R. 167134 - 03/18/15)

RULE:
THE COURT NOTED THAT SURPRISINGLY, NOT A SINGLE COPY OF A
TRUST INDENTURE AGREEMENT AND/OR THE CERTIFICATE OF
PARTICIPATION (AS EVIDENCE OF THE TRUST) WAS INCLUDED IN
THE RECORDS OF THE CASE.
THE IMPORTANCE OF THE ACTUAL TRUST INDENTURE
AGREEMENTS CANNOT BE GAINSAID.
THE ONLY WAY THE COURT CAN DETERMINE THE ACTUAL
RELATIONSHIP BETWEEN TRB AND ITS CLIENTS IS THROUGH A
SCRUTINY OF THE TERMS AND CONDITIONS EMBODIED IN SAID
AGREEMENTS.
THE BURDEN FELL UPON TRB TO PRODUCE THE TRUST INDENTURE
AGREEMENTS BECAUSE ITS PROTEST WAS ENTIRELY GROUNDED
ON THE ALLEGATION THAT SAID AGREEMENTS WERE TRUSTS.
CIR VS. TRADERS ROYAL BANK
(G.R. 167134 - 03/18/15)
RULE:
THE COURT MERELY RELIED ON A READING OF SECTION X407 OF THE
1993 MANUAL OF REGULATIONS FOR BANKS (MORB) EXPLAINING THE
BASIS CHARACTERISTICS OF A TRUST OR OTHER FIDUCIARY AND
INVESTMENT MANAGEMENT RELATIONSHIP.
NEVERTHELESS, THERE WAS STILL A NECESSITY FOR TRB TO
PRESENT THE TRUST INDENTURE AGREEMENT TO TEST THE TERMS
AND CONDITIONS THEREOF AGAINST THE STANDARDS SET BY SEC.
X407 OF THE MORB. TAX ASSESSMENTS ARE PRESUMED CORRECT
AND MADE IN GOOD FAITH AS RULED IN SY PO VS. COURT OF TAX
APPEALS AND GIVEN THE FAILURE OF TRB TO PRESENT PROOF OF
ERROR IN THE CIR TAX ASSESSMENTS, THE SAME IS PRESUMED
CORRECT.
HENCE, TRB IS LIABLE TO PAY DEFICIENCY DST ON ITS TRUST
INDENTURE AGREEMENTS FOR 1996 & 1997 PLUS INCREMENTAL
PENALTIES.
NEW REPUBLIC ACTS,
REGULATIONS AND CIRCULARS
A. INCOME TAX
REPUBLIC ACT 10653 - 02/16/15

THIS R.A. INCREASED THE 13TH MONTH PAY EXCLUSION:


A. THE 13TH MO. PAY AND OTHER BENEFITS EXCLUSION FROM
GROSS INCOME HAS BEEN INCREASED FROM P30,000 TO P82,000

B. THIS WILL COVER OTHER BENEFITS SUCH AS PRODUCTIVITY


INCENTIVES AND CHRISTMAS BONUS

C. THE INCREASED AMOUNT APPLIES TO BONUSES AND OTHER


BENEFITS PAID OR ACCRUED BEGINNING JANUARY 1, 2015
Revenue Regulation No. 1-2015
dated January 05, 2015

• Benefits received by an employee by virtue of a CBA & productivity not


exceeding Php10,000 per employee per year are not subject to WTC
and to FBT

• Amends RR Nos. 2-98 and 3-98 on De Minimis Benefits by adding:


“Benefits received by an employee by virtue of a Collective Bargaining
Agreement (CBA) and Productivity Income Schemes provided that the
total annual monetary value received from both CBA and productivity
income schemes do not exceed Php 10,000 per employee per taxable
year.”
Revenue Regulation No. 3-2015
dated March 09, 2015

• Amends RR Nos. 2-98 to implement provisions of RA No. 10653 on the


increase of Php 82,000 of the total exclusion from gross income for
13th month pay and other benefits.

• The exclusion of Php 82,000 shall apply only to the 13th month pay and
other benefits paid beginning January 01, 2015 and shall not apply to
other compensation such as basic salary and allowances.

• This regulation is not applicable to self-employed individuals and


income generated from business.

• All taxpayers shall ensure correct computation and application of the said
increase and indicate the same in Certificate of Compensation/ Tax
Withheld BIR Form No. 2316)
Revenue Regulation No. 7-2015
dated March 31, 2015

• THIS AMENDS RR 2-98 BY REQUIRING A CREDITABLE


WITHHOLDING TAX OF 1% ON ANY INCOME PAYMENTS ON
PURCHASES OF SUGAR.

• THIS ALSO REQUIRES SUGAR OWNERS WHO PLANTS THEIR OWN


SUGAR WHOSE GROSS RECEIPTS FOR A YEAR DOES NOT
EXCEED P300,000 TO COMPLY WITH SIMPLIFIED RULES OF
REGISTRATION AND BOOKKEEPING.
Revenue Regulation No. 13-2015
dated October 12, 2015

• THIS AMENDS RR 7-2015 BY PROVIDING THAT PROPRIETORS OR


OPERATORS OF SUGAR MILLS/ REFINERIES WHICH PAYMENTS TO
THEM ON PURCHASERS OF SUGAR SHOULD WITHHOLD THE 1%
CWT SHALL BE ENSURED THAT A COPY OF THE WEEKLY FINAL
SUGAR PRODUCTION BULLETIN BE OFFICIALLY TRANSMITTED BY
THE SUGAR REGULATORY ADMINISTRATION (SRA) WITHIN 24
HOURS FROM THE DATE OF THE ISSUANCE THEREOF.
B. REPORTORIAL REQUIREMENTS
Revenue Regulation No. 2-1015
dated December 17, 2014

SALIENT FEATURES
A. REQUIRES MANDATORY SUBMISSION OF SUMMARY ALPHALIST
OF WITHHOLDING AGENTS (SAWT) OF INCOME PAYMENTS
SUBJECTED TO CREDITABLE WITHHOLDING TAXES BY THE
PAYEE/INCOME RECIPIENT AND OF MONTHLY ALPHALIST OF
PAYEES (MAP SUBJECTED TO WITHHOLDING TAX BY THE
WITHHOLDING AGENT/INCOME PAYOR AS ATTACHMENT TO THEIR
FILED RETURNS.
B. IN CASES COVERED BY SUBSTITUTED FILING, AN EMPLOYER
SHALL FURNISH EACH EMPLOYEE WITH THE ORIGINAL COPY OF
BIR FORM 2316 AND IN LIEU OF THE HARD COPIES OF TH
DUPLICATE ORIGINAL, A DULY ACCOMPLISHED DVD-R SHALL BE
SUBMITTED TO THE BIR OFFICE NOT LATER THAN FEB. 28
FOLLOWING THE CLOSE OF THE CALENDAR YEAR.
Revenue Regulation No. 5-2015
dated March 17, 2015

• THIS AMENDS RR 6-2014 BY IMPOSING PENALTIES FOR FAILURE TO


FILE RETURNS UNDER THE ELECTRONIC SYSTEMS OF THE BIR BY
TAXPAYERS MANDATORILY COVERED BY eFPS or eBIR FORMS.
• THIS COVERS NON eFPS FILERS WHICH SHALL MANDATORILY USE
eBIR FORMS FACILITY IN ELECTRONICALLY SUBMITTING AND FILING
ALL THEIR TAX RETURNS.

• UPON SUCCESSFUL VALIDATION OF THE ACCOMPLISHED TAX


RETURNS, TAXPAYERS SHALL RECEIVE A SYSTEM-GENERATED
NOTIFICATION E-MAIL WHICH ACKNOWLEDGES THAT THE TAX
RETURN HAS BEEN SUCCESSFULLY FILED.
• TAXPAYER SHOULD PRINT THE FILING REFERENCE NO. (FRN) PAGE
GENERATED BY THE SYSTEM AND SUBMITTED TO AABs FOR THE
PAYMENT OF THE TAX DUE THEREON.
Revenue Regulation No. 10-2015
dated September 21, 2015

• THIS MANDATES THE USE OF NON-THERMAL PAPER FOR ALL


CASH REGISTER MACHINES (CRMs)/ POINT-OF-SALES (POS)
MACHINES AND OTHER INVOICE/ RECEIPT GENERATING
MACHINE/ SOFTWARE.

• IT ALSO PROVIDED THE INFORMATION THAT SHALL APPEAR AT


THE OFFICIAL RECEIPTS/ SALES NVOICES/ OTHER COMMERCIAL
INVOICES GENERATED FROM CRM/POS/OTHER SIMILAR
MACHINES/ SOFTWARE.
Revenue Regulation No. 11-2015
dated September 29, 2015

• THIS REGULATIONS PROVIDES THE LIST OF IDENTIFICATION


DOCUMENT OR PROOF WHICH WILL BE REQUIRED FOR A SENIOR
CITIZEN TO AVAIL OF THE BENEFITS AND PRIVILEGES UNDER
THE ‘EXPANDED SENIOR CITIZENS ACT OF 2010’.

• THIS ALSO PROVIDED THE TAX TREATMENT OF THE DISCOUNT


GRANTED TO SENIOR CITIZENS AS AN ADDITIONAL DEDUCTION
FROM GROSS INCOME.

• IT IS REQUIRED THAT BUSINESS ESTABLISHMENT SHOULD KEEP


AN ACCURATE RECORD OF SALES WHICH SHALL INCLUDE THE
NAME OF SENIOR CITIZEN AND THE IDENTIFICATION DOCUMENT
AND INVOICE NUMBERS FOR EVERY SALE TO SENIOR CITIZENS.
Revenue Regulation No. 14-2015
dated November 09, 2015

THIS REGULATION AMENDS SEC. 2 OF RR 12-2015 IN RELATION TO


RR 10-2015 BY PROVIDING AMPLE TIME IN PROCURING,
RECONFIGURING MACHINES AND SYSTEMS, TO COMPLY WITH SEC.
5, ADJUSTMENTS SHALL BE UNDERTAKEN ON OR BEFORE
DECEMBER 31, 2015, ANY EXTENSION SHALL SEEK THE APPROVAL
FROM THE CONCERNED REGIONAL DIRECTOR OR LARGE
TAXPAYER SERVICE WHICH SHALL NOT BE LONGER THAN 6
MONTHS FROM THE EFFECTIVITY OF THESE REGULATIONS.
C. REMEDIES
Revenue Regulation No. 18-2013
dated November 28, 2013

SALIENT FEATURES
1. THE NOTICE OF INFORMAL CONFERENCE STAGE IN RR 12-99 HAS
BEEN DELETED IN THE ISSUANCE OF A DEFICIENCY TAX
ASSESSMENT;

2. BIR WOULD ISSUE A PRELIMINARY ASSESSMENT NOTICE (PAN) IF


AFTER ITS AUDIT OF TAXPAYER’S BOOKS, THERE IS SUFFICIENT
BASIS TO ASSESS DEFICIENCY OR DELINQUENCY;

3. A FORMAL LETTER OF DEMAND (FLD) AND FINAL ASSESSMENT


NOTICE (FAN) WILL BE ISSUED IF THE ASSESSED TAXPAYER FAILS
TO RESPOND WITHIN 15 DAYS FROM RECEIPT OF THE PAN OF 15
DAYS FROM SUBMISSION OF TAXPAYER’S REPLY.
Revenue Regulation No. 18-2013
dated November 28, 2013

SALIENT FEATURES - continuation


4. THE TAXPAYER MUST FILE A PROTEST LETTER WITHIN 30 DAYS
FROM RECEIPT OF THE FAN, OTHERWISE THE ASSESSMENT WILL
BE FINAL AND EXECUTORY. A TAXPAYER MUST STATE WHETHER
THE PROTEST LETTER IS A REQUEST FOR RECONSIDERATION
OR REINVESTIGATION, WHICHEVER APPLIES.

A REQUEST FOR RECONSIDERATION IS A PLEA FOR RE-


EVALUATION OF AN ASSESSMENT ON THE BASIS OF EXISTING
DOCUMENTS ALREADY PRESENTED BEFORE. THE 60-DAY RULE
FOR SUBMISSION OF SUPPORTING DOCUMENTS UNDER SEC. 228
OF THE TAX CODE DOES NOT APPLY.
Revenue Regulation No. 18-2013
dated November 28, 2013

REQUEST FOR REINVESTIGATION – IS A PLEA FOR RE-EVALUATION


OF AN ASSESSMENT ON THE MERITS OF NEWLY DISCOVERED
DOCUMENTS WHICH A TAXPAYER INTENDS TO PRESENT ON THE
REINVESTIGATION. THE TAXPAYER HAS 60 DAYS FROM THE FILING
OF THE PROTEST TO SUBMIT ITS SUPPORTING DOCUMENTS.

IN CASES WHERE THERE ARE SEVERAL FINDINGS, A COLLECTION


LETTER WILL BE ISSUED WITH REGARD TO THE DEFICIENCY
FINDINGS WHICH ARE NOT DISPUTED OR EVEN IF DISPUTED, THE
BIR IS NOT CONVINCED WITH THE ARGUMENTS PRESENTED.
Revenue Regulation No. 18-2013
dated November 28, 2013

SALIENT FEATURES - continuation


5. A TAXPAYER HAS 30 DAYS FROM RECEIPT OF THE FINAL
DECISION DENYING THE PROTEST TO ELEVATE CASE TO THE CTA.
6. IF THE PROTEST IS NOT ACTED UPON BY THE BIR AFTER 180
DAYS FROM THE DATE OF FILING OF THE PROTEST IN CASE OF A
REQUEST FOR RECONSIDERATION OR FROM THE DATE OF
SUBMISSION OF THE REQUIRED DOCUMENTS IN CASE OF
REQUEST FOR REINVESTIGATION, TAXPAYER MAY APPEAL TO CTA
WITHIN 30 DAYS AFTER THE 180 DAYS PERIOD UNDER SEC. 228 OF
THE TAX CODE (INACTION).
7. THE OPTION OF THE TAXPAYER TO APPEAL TO THE CTA DUE TO
INACTION OR ADVERSE DECISION OF THE BIR ARE MUTUALLY
EXCLUSIVE.
Deficiency Interest vs. Delinquency Interest

Revenue Regulation No. 18-2013


Deficiency is defined as the amount still due and collectible from
a taxpayer upon audit or investigation.
Delinquency is defined as the failure of the taxpayer to pay the
tax due on the date fixed by law or indicated in the assessment
notice or letter of demand.

Deficiency interest is imposed for the shortage of taxes paid,


while Delinquency interest is imposed for the delay in payment
of taxes.
D. VALUE ADDED TAX (VAT)
VAT EXEMPTION ON SALE

REV. REGULATIONS 15-2015 – 12/28/15


THE EXEMPTION FROM VAT ON THE IMPORTATION AND
LOCAL PURCHASE OF PASSENGER AND /OR CARGO
VESSELS SHALL BE SUBJECT TO THE REQUIREMENTS ON
RESTRICTION ON VESSELS IMPORTATION AND
MANDATORY VESSEL RETIREMENT PROGRAM OF
MARINA.
REV. MEMO CIRCULAR 25-2015 - 05/06/15

THIS CLARIFIES THE IMPOSITION OF ADVANCE BUSINESS TAX (VAT


OR PERCENTAGE TAX) ON RAW SUGAR AND REFINED SUGAR
UNDER RR NO. 6-2015 DATED MARCH 31, 2015.
THE PHYSICAL INVENTORIES OF RAW SUGAR AND REFINED SUGAR
COVERED BY QUEDANS WHICH ARE DATED BEFORE MAY 1, 2015
ARE NOT SUBJECT TO THE IMPOSITION OF ADVANCE BUSINESS
TAX.
IF THE TAXPAYER IS ENGAGED IN INTEGRATED OPERATIONS OF
MILLING & REFINING OF SUGAR, THE TAX SHALL BE IMPOSED ON
RAW SUGAR PRODUCED IN THE MILLING OPERATIONS IF SOLD TO
ANOTHER PERSON OR ENTITY.
REV. MEMO CIRCULAR 25-2015 - 05/06/15

IF THE RAW SUGAR IS JUST TRANSFERRED TO THE REFINERY


OPERATION OF THE TAXPAYER FOR PURPOSES OF REFINING AND
CONVERTING THE SAME INTO REFINED SUGAR, ONLY THE
ADVANCE BUSINESS TAX ON THE REFINED SUGAR SHALL BE
IMPOSED.
THERE WILL BE NO SEPARATE IMPOSITION OF BUSINESS TAX ON
RAW SUGAR AND REFINED SUGAR, SINCE NO SALE TRANSACTION
HAS TRANSPIRED, SINCE BOTH PRODUCTS ARE OWNED BY THE
SAME TAXPAYER.
Revenue Memo Circular 70-2015
dated October 29, 2015

TRANSPORT NETWORK CO. (TNCs)* LIKE UBER &


GRABTAXI ARE COVERED BY VAT
A. TNCs HOLDING A FRANCHISE ARE COVERED BY VAT OR
COMMON CARRIER’S TAX AND REQUIRED TO ISSUE ORs TO
CUSTOMERS;
B. TNCs WITH A FRANCHISE ARE SUBJECT TO 3% COMMON
CARRIER’S TAX WHILE THOSE THAT DO NOT HAVE ARE LIABLE
TO 12% VAT;
C. TNCs AND THEIR PARTNERS NEED TO SECURE AN AUTHORITY
TO PRINT (ATP) ORs AND REGISTER BOOKS OF ACCOUNTS;
D. TNCs SHALL OBTAIN AN ATP UNDER THE e-INVOICING SYSTEM
FOR THE ORs ISSUED TO PASSENGERS.
REV. MEMO CIRCULAR 64-2015- 10/02/15

THIS CIRCULAR REITERATED THE REQUIRED INFORMATION ON


RECEIPTS/INVOICES/OTHER COMMERCIAL INVOICES GENERATED
FROM CASH REGISTER MACHINES (CRM), POS MACHINES/
SOFTWARE FOR VAT RECEIPTS/ INVOICES PURPOSES.

IN SALES AMOUNT TO P1,000 OR MORE TO A VAT-REGISTERED


PERSON, THE VAT RECEIPTS/INVOICES MUST CONTAIN THE NAME,
ADDRESS, TIN AND BUSINESS STYLE, IF ANY.
REV. MEMO CIRCULAR 64-2015- 10/02/15

THE ABOVE INFORMATION MUST BE REFLECTED IN


RECEIPTS/INVOICES GENERATED FROM CRM/POS MACHINES. IF
THE CRM/POS MACHINE IS INCAPABLE OF SHOWING SUCH
REQUIREMENTS, A MANUALLY PRE-PRINTED RECEIPT/INVOICE
WITH APPROVED AUTHORITY TO PRINT (ATP) MUST BE ISSUED TO
THE CLIENT.

THESE REQUISITES ARE NECESSARY TO AVAIL OF A VALID CLAIM OF


INPUT TAX CREDIT BY VAT-REGISTERED TAXAPAYERS.
Revenue Memo Circular 70-2015
dated October 29, 2015

*TNC IS AN ORGANIZATION THAT PROVIDES PRE-ARRANGED


TRANSPORTATION SERVCES FOR COMPENSATION USING AN
INTERNET-BASED TECHNOLOGY APPLICATION OR A DIGITAL
PLATFORM TECHNOLOGY TO CONNECT PASSENGERS WITH
DRIVERS USING THEIR PERSONAL SERVICES.
Revenue Regulation No. 4-2015
dated March 13, 2015

• THIS AMENDS RR 13-08 BY DEFINING RAW SUGAR AND RAW CANE


SUGAR FOR VAT PURPOSES.

• UNDER THIS REGULATION, REFINED SUGAR AND RAW SUGAR


SHALL BE SUBJECT TO ADVANCE PAYMENT OF VAT BY THE
OWNER/SELLER BEFORE THE SUGAR IS WITHDRAWN FROM ANY
SUGAR REFINERY/MILL21
Revenue Regulation No.6-2015
dated March 31, 2015

• THIS IMPLEMENTS THE REGULATIONS IMPOSING ADVANCE


BUSINESS TAX (VAT OR PERCENTAGE TAX) PAYMENTS ON SUGAR
AND FOR OTHER RELATED PURPOSES.

• THE AMOUNT OF ADVANCE VAT PAYMENT SHALL BE DETERMINED


BY THE APPLYING THE 12% VAT ON THE APPLICABLE BASE PRICE
OF P1,400 PER 50 KG. BAG FOR REFINED SUGAR AND P1,000 PER
50 KG. BAG FOR ALL OTHER TYPES OF SUGAR.
Revenue Regulation No.15-2015

• THIS REGULATION INCLUDED AMONG THE VAT-EXEMPT


TRANSACTIONS THE TRANSPORT OF PASSENGERS BY
INTERNATIONAL CARRIERS DOING BUSINESS IN THE PHILIPPINES
AND THE TRANSPORT OF CARGO BY INTERNATIONAL CARRIERS
DOING BUSINESS IN THE PHILIPPINES.

• IT ALSO PROVIDED THAT THE EXEMPPTION FROM VAT ON THE


IMPORTATION AND LOCAL PURCHASE OF PASSENGER AND/OR
CARGO VESSELS SHALL BE SUBJECT TO THE REQUIREMENTS ON
RESTRICTION ON VESSEL IMPORTATION AND MANDATORY
VESSEL RETIREMENT PROGRAM OF MARINA.
E. INTERNAL REVENUE STAMP
Revenue Regulation No.9-2015
dated September 02, 2015

• THIS REGULATION PRESCRIBES THE AFFIXTURE OF INTERNAL


REVENUE STAMPS ON IMPORTED AND LOCALLY MANUFACTURED
CIGARETTES AND THE USE OF THE INTERNAL REVENUE STAMP
INTEGRATED SYSTEM.

• IT ALSO STATED THAT ANY CIGARETTES WITHOUT ANY INTERNAL


REVENUE STAMP AFFIXED SHALL BE PRESUMED TO HAVE BEEN
WITHDRAWN WITHOUT THE PAYMENT OF EXCISE TAX AND SHALL
BE SUBJECT TO THE PENALTIES PROVIDED UNDER THE TAX
CODE.
TAX FILING COMPLIANCE
TAX FILING COMPLIANCE

REV. MEMO CIRCULAR 11-2015 – 3/20/15


THIS CLARIFIES SECTION 4(1) OF REV. REGULATIONS NO. 6-
2014.THIS PROVIDES CLARIFICATIONS ON TAX PRACTITIONERS/
AGENTS MANDATED TO USE THE ELECTRONIC BIR FORM (e-BIR
FORMS).
THIS COVERS ONLY NON e-FPS FILERS.
THOSE ‘CLIENT-TAXPAYERS’ WHOSE TAX AGENTS/PRACTITIONERS
ONLY SIGNTHE AUDIT CERTIFICATE BUT HAVE NO AUTHORITY TO
FILE THE RETURNS IN THEIR BEHALF ARE NOT COVERED BY THIS
CIRCULAR.
THE LINKING MODULE OF AUTHORIZATION BY THE CLIENT-
TAXPAYER TO HIS TAX AGENT/PRACTITIONER IS AVAILABLE ON
LINE VIA e-BIR FORMS.
TAX FILING COMPLIANCE

REV. MEMO CIRCULAR NO. 14-2015 – 3/30/15


THIS CIRCULAR PROVIDES GUIDELINES USING THE ELECTRONIC
PLATFORM OF BIR FOR 2014 (BIR FORM 1700, 1701, 1702) FOR THE
FILING OF THE ITRs DUE ON OR BEFORE APRIL 15, 2015.

THIS CIRCULAR DOES NOT COVER TAXPAYERS WHO ARE NOT


MANDATED TO USE THE e-FPS/e-BIR FORMS AND WHO HAVE NOT
OPTED TO FILE ELECTRONICALLY, AND THUS THE EXISTING
PROCEDURES ON MANUAL FILING SHALL APPLY.
TAX FILING COMPLIANCE

REV. MEMO CIRCULAR NO. 14-2015 – 3/30/15


PROCEDURAL STEPS:
1. DOWNLOAD AND INSTALL THE OFFLINE e-BIR FORMS PACKAGE.
2. SELECT THE FORM AND FILL-UP BY ENCODING DATA IN THE ITR.
3. VALIDATE AFTER ENCODING ALL INFORMATION AND CLICK THE
FINAL COPY.
4. SUBMIT THE ACCOMPLISHED TAX RETURN. AN EMAIL MESSAGE
WILL BE RECEIVED BY THE TAXPAYER.
REV. MEMO CIRCULAR 10-2015 – 03/23/2015

THIS CIRCULAR PROVIDES GUIDELINES FOR FILING OF BIR FORM


NO 1700 COVERING EMPLOYEES OF IDENTIFIED LARGE
TAXPAYERS WHO ARE NOT QUALIFIED FOR THE SUBSITITUTED
FILING AND EMPLOYEES QUALIFIED FOR SUBSTITUTED FILING BUT
OPTED TO FILE FOR AN ITR.

RDOs ARE DIRECTED TO ACCEPT BIR FORM 1700 FILED BY


EMPLOYEES OF LT.

BIR FORM WITH NOPAYMENT SHALL BE FILED MANUALLY USING e-


BIR FORMS AND THOSE WITH PAYMENT WITH ANY AUTHORIZED
AGENT BANK WITHIN THE RDO.
REV. MEMO CIRCULAR 18-2015 - 04/10/15

THE CIR HAS DEFERRED UNTIL JUNE 15, 2015 THE ELECTRONIC
FILING OF ITRs OF TAXPAYERS WHO SHALL FILE A “NO PAYMENT
RETURNS” USING e-BIR FORMS. TAXPAYERS WHO ARE NEWLY
ENROLLED TO e-FPS WHOSE REGISTRATION WITH AUTHORIZED
AGENTS BANKS HAVE NOT BEEN COMPLETED SHALL
ELECTRONICALLY FILE THEIR RETURNS MANUALLY NOT LATER
THAN APRIL 15, 2015 AND COMPLETE THEIR E-PAYMENT FILING ON
ALL SUCEEDING RETURNS NOT LATER THAN JUNE 15, 2015.
REV. MEMO CIRCULAR 24-2015 – 05/06/15

THIS CIRCULAR CLARIFIES REV. REG. NO. 2-1015 ON THE


SUBMISSION BY CONCERNED TAXPAYERS OF SCANNED COPIES
OF THE CERTIFICATE OF CREDITABLE TAX WITHHELD AT SOURCE
(BIR FORM 2307) AND CERTIFICATE OF COMPENSATION PAYMENT/
TAX WITHHELD (BIR FORM 2316).

THE EFFECTIVITY DATE OF THE IMPLEMENTATION FO RR. NO. 2-


1015 INSOFAR AS THE SUBMISSION OF SCANNED COPIES OF BIR
FORMS 2307 & 2316 IS MARCH 21, 2015. (15 DAYS AFTER
PUBLICATION ON 3/6/15)
REV. MEMO CIRCULAR 24-2015 – 05/06/15

FOR THE INITIAL IMPLEMENTATION OF RR. NO. 2-2015, TAXPAYERS


ADOPTING A CALENDAR OR FISCAL YEAR ACCOUNTING PERIOD MAY
OPT TO SUBMIT THE REQUIRED BIR FORM 2307 EITHER IN HARD OR
IN SCANNED COPIES, WITH THE QUARTERLY INCOME TAX RETURNS
DUE FOR FILING NOT LATER THAN APRIL 30, 2015.

FOR QUARTERLY FLING BEYOND 4/30/15, TAXPAYERS ARE


MANDATED TO SUBMIT BIR FORM NO. 2307 IN SCANNED COPIES.
REV. MEMO CIRCULAR 24-2015 – 05/06/15

SEC. 4 OF RR NO. 2-2006 REMAINS IN FULL FORCE AND EFFECT,


SPECIFICALLY ON THE RETENTION OF HARD COPIES OF THE
CERTIFICATES OF TAXES WITHHELD FOR AUDIT PURPOSES.
AS SUCH, THE PRESENTATION OF THESE CERTIFICATES MAY BE
REQUESTED TO VALIDATE THE TAX CREDITS BEING CLAIMED BY
INCOME RECIPIENTS IN THEIR TAX RETURNS.
IT IS NOT NECESSARY TO PREPARE SEPARATE COPIES OF BIR
FORM 2307 IN CASES WHERE THERE ARE TWO OR MORE INCOME
PAYMENTS MADE BY AN INCOME PAYOR-WITHHOLDING AGENT TO
THE SAME RECIPIENT THAT ARE SUBJECT TO DIFFERENT CWT
RATES.
REV. MEMO CIRCULAR NO. 26-2015 - 05/6/15

THIS CIRCULAR IS ISSUED TO PROVIDE GUIDELINES IN THE FILING


OF VARIOUS BIR FORMS USING THE ELECTRONIC PLATFORMS OF
THE BIR. THIS DOES NOT COVER TAXPAYERS WHO ARE NOT
MANDATED TO USE THE ELECTRONIC FILING AND PAYMENT
SYSTEM (e-FPS)/e-BIR FORMS AND WHO HAVE NOT OPTED TO FILE
ELECTRONICALLY AND THUS THE EXISTING PROCEDURES ON
MANUAL FILING SHALL APPLY.
THOSE TAXPAYERS FILING WITH PAYMENT OR NO PAYMENT USING
OFFLINE e-BIR FORMS SHALL FOLLOW THE SAME PROCEDURES IN
ANNEX “D” OF RMC 14-2015.
REV. MEMO CIRCULAR 36-2015- 06/29/15

THIS CIRCULAR MANDATED THE ONE-TIME SUBMISSION BY


TAXPAYERS OF THEIR INVENTORY OF CASH REGISTER MACHINES,
POINT OF SALE MACHINES AND SPECIAL PURPOSE MACHINES TO
EFFECTIVELY SUPERVISE AND MONITOR THE ISSUANCE OF SALES
INVOICES AND RECEIPTS BY BUSINESS ESTABLISHMENTS USING
THESE MACHINES.

TAXPAYERS SHALL SUBMIT THE INVENTORY BY JULY 31, 2015.


REV. MEMO CIRCULAR 57-2015- 09/16/15

THIS CIRCULAR REQUIRES ALL TAXPAYERS WITH TANGIBLE-ASSET-


RICH BALANCE SHEETS HAVING STOCK IN TRADE INVENTORY, RAW
MATERIALS, GOODS IN PROCESS AND OTHER GOODS REFERRED
TO BY BIR AS “SALEABLE INVENTORIES” TO SUBMIT HARD AND
SOFT COPIES OF THE ENHANCED FORMAT OF INVENTORY LIST ON
OR BEFORE SEPT. 30, 2015.

THIS COVERS MANUFACTURERS, WHOLESALERS, DISTRIBUTORS,


RETAILERS INCLUDING REAL ESTATE DEALERS, DEVELOPERS,
SERVICE COMPANIES AND OTHER CONTRACTORS.
REV. MEMO CIRCULAR 57-2015- 09/16/15

THE CIRCULAR REQUIRES THE USE OF CODES TO EASILY


DETERMINE THOSE INVENTORIES OWNED AND NOT OWNED BY
THE TAXPAYERS SUCH AS:

A) CODE “CH” – GOODS ON CONSIGNMENT HELD BY TAXPAYER;


B) CODE “P” – PARKED GOODS OWNED BY RELATED PARTIES;
C) CODE “O” – GOODS OWNED BY TAXPAYER;
D) CODE “CO”- GOODS OUT ON CONSIGNMENT IN THE HANDS OF
AN ENTITY OTHER THAN THE TAXPAYER.

UNDER RMC 61-2015 DATED 9/30/15, THE DEADLINE FOR


SUBMISSION WAS EXTENED UP TO OCTOBER 31, 2015.
REV. MEMO CIRCULAR NO. 68-2015- 08/01/15

THIS CIRCULAR MANDATES THE ACCREDITATION OF ALL CASH


REGISTER MACHINES (CRM)/POINT-OF-SALE (POS) MACHINES AND
OTHER SALES MACHINES AND OTHER SALES MACHINES/ RECEIPTING
SOFTWARE AT THE BIR NATIONAL OFFICE. ALL NEW APPLICATIONS FOR
ACCREDITATION OF CRM/POS/OTHER SALES MACHINES/ RECEIPTING
SOFTWARE OF DEVELOPERS/ DISTRIBUTORS/ VENDOR SHALL BE
PROCESSED BY THE BIR NATIONAL OFFICE THROUGH THE NATIONAL
ACCREDITATION BOARD.