BIR Begins Probe Into ITRs

MANILA, Philippines - The Bureau of Internal Revenue (BIR) starts today its nationwide investigation of 2011 income tax returns (ITRs) filed by individuals and corporations last April.

Revenue Commissioner Kim S. Jacinto-Henares instructed tax collectors to continue their audit work to meet their individual collection assignments for the year.

The BIR chief issued the instruction over the weekend before flying to Spain to attend the two-day meeting of the Organization for Economic Cooperation and Development (OECD) for tax administrators of member countries.

Revenue regional directors and heads of various divisions of the Large Taxpayers Service (LTS) were reluctant to open the 2011 ITRs for audit purposes.

They are waiting for the issuance of the so-called Annual Audit Program (AAP) by the top management, a practice adopted previously before an investigation can commence.

Henares said no such guideline will be issued for the year and tax examiners should continue what they have been doing for the BIR generate more funds to support President Aquino's social and economic development programs.

She said taxpayers with deficiency taxes should be required to pay additional amounts and those who deliberately falsified their tax records should be ferreted out so that they can be included in the Run-After-Tax-Evaders (RATE).

The BIR has experienced difficulties in meeting its collection targets for first four months of the year but the take was substantially higher than the actual collection for the same period last year raising P345.5 billion.

Higher fiscal authorities fixed the BIR collection goal for the year at P1.066 trillion.

source: mb.com.ph

BIR loses P600M tax case against Petron

BAGUIO CITY -- The Bureau of Internal Revenue (BIR) has lost a P600-million tax case against multinational oil company Petron Corp. (Petron).

In a ruling promulgated on March 21, 2012 but was released to the media on Tuesday, the SC, through Associate Justice Maria Lourdes Sereno, dismissed the appeal filed by the BIR for lack of merit.

The BIR elevated the case to the SC after the Court ofBureau of Internal Revenue (CTA) en banc reversed its Second Division ruling ordering Petron to pay P600,769,353.95 as deficiency excise taxes for 1995 to 1998, including surcharges and interest plus 25 percent surcharge and 20 percent delinquency interest per annum.

In its petition, the BIR said that Tax Credit Certificates (TCCs) from various Board of Investments (BOI) entities assigned to Petron covering taxable years 1995 to 1998, which Petron used in the payment of its excise taxes had been cancelled by the Department of Finance (DOF) pursuant to DOF EXCOM Resolution No. 03-05-99 for having been "fraudulently issued and transferred."

In its 2007 decision, the CTA Second Division directed Petron to pay BIR P600,769,353 in deficiency excise taxes for subject years.

However, the CTA en banc said that Petron was a "transferee in good faith," had no participation in the issuance and transfer of the TCCs, and could not be held accountable for the cancelled TCCs.

In its decision, the SC echoed the CTA en banc's ruling that Petron is a "transferee in good faith and for value of the subject TCCs."

"From the records, we observe that the BIR had no allegation that there was a deviation from the process for the approval of the TCCs, which Petron used as payment to settle its excise tax liabilities for the years 1995 to 1998," the SC said.

"We agree with the pronouncement of CTA en banc that Petron has not been shown or proven to have participated in the alleged fraudulent acts involved in the transfer and utilization of the subject TCCs. Petron had the right to rely on the joint stipulation that absolved it from any participation in the alleged fraud pertaining to the issuance and procurement of the subject TCCs," it said.

"The joint stipulation made by the parties consequently obviated the opportunity of the BIR to present evidence on this matter as no proof is required for an admission made by a party in the course of the proceedings. Thus, the BIR cannot now be allowed to change its stand and renege on that admission," the SC said.

source: interaksyon.com

House members differ over Pacquiao's fight against BIR

MANILA, Philippines -- House members are of two minds on the accusation by their peer, Saranggani Rep. Manny Pacquiao, that he is being persecuted by the Bureau of Internal Revenue. One view holds he should just quietly settle the issue with the tax agency, while another view insists he was treated unfairly.

Leaders of the House of Representatives said Wednesday that instead of crying harassment, Pacquiao should just explain to the BIR the questions raised on his tax payments.

“Congressman Pacquiao should talk to BIR preferably with his accountant. That’s the better way to settle the issue,” Speaker Feliciano Belmonte Jr. said.

The issue at hand stems from a case the BIR lodged against Pacquiao for alleged violation of Section 266 of the National Internal Revenue Code or the provision on “failure to obey summons.”

Majority Leader and Mandaluyong City Rep. Neptali “Boyet” Gonzales II said the cry of harassment by the boxing champion was unfounded.

“There no basis to cry harassment,” Gonzales said, adding “to further connect it to the impeachment is hitting below the belt.”

But Pacquiao's friend and colleague from San Juan City thinks otherwise.

“Insensitive and a major distraction in preparation for Pacman’s June fight” was how San Juan Rep. JV Ejercito slammed the BIR and Commissioner Kim Henares’ attitude toward their handling of the alleged tax fraud case against Pacquiao.

The lawmaker said this distraction is all due to the bureau’s process of exacting tax, which has now come to a point of harassment to the personality of the Sarangani Representative.

“BIR’s duty is given; Manny is not taking that personally. What only bothers him is how his case is being handled. Because BIR officials coming out to speak to the media is apparently becoming an attack to his personality rather than what they say as a fulfillment of duty,” Ejercito explained.

“For example, in news reports, some government officials may not be blatantly labeling Pacman as a tax evader. But if you read between the lines, it’s all the same,” he added.

And given Pacquiao’s rock star status, Ejercito said the media picks up almost every news item that relates with the boxing champ so easily.

“It is just unfortunate that at this time that Pacman needs to promote his upcoming fight, some government officials choose to feed media with pressers that smear on his personality,” he furthered.

“Is this how the government repays him with the victories he has brought to our country, by harassing him in the public to pay his taxes?”

But this is not to say that he and his colleagues in Congress are seeking for special attention with regard to Pacquiao's taxes, the lawmaker said. “Manny is only asking for consideration that they (government) listen to his side of the story. Because after all, he is also a public official.”

In the end, Ejercito hopes the BIR is not merely riding on Pacquiao’s popularity to portray that it is performing well, but is only after accomplishing its tax exacting responsibilities.

source: interaksyon.com