Tariffs and Taxes

[Ady001]

And Manny Pacquiao and Willie Revillame by the way?

[hakz2007]

Shell asks court to cite customs officials for contempt

MANILA, April 13 (PNA)—Oil giant Pilipinas Shell Petroleum Corp., (PSPC) has cried foul on the actions made by the customs personnel for violating the gag order issued by the court.

In a statement, Shell legal counsel John Balisno asked the Court of Tax Appeals to cite for contempt presidential assistant on revenue enhancement Narciso Santiago Jr., and Customs officials after they called for a news conference where they divulged that they planned to asked Presiding Justice Ernesto Acosta to inhibit himself from the case since he was a Shell employee from 1975 to 1981.

"It came as a big surprise to us that Customs would call a press conference even before the actual filing of a motion for inhibition and even before a notice thereof is served upon our client (Shell) and the justice concerned. What could be its purpose if not to put the court on the defensive and unfairly pre-condition the minds of the public? This is a clear case of contempt," he said.

Balisnomo said that the rules of the Supreme Court states that even justices of the Supreme Court need not inhibit where the connection or relationship had terminated for at least 10 years. In this case, Shell's relationship with Justice Acosta was almost 30 years ago.

Moreover, Balisno said the independence and integrity of Acosta was best shown when he ruled against Shell in another case that is now pending with the CTA en banc.

Shell is disputing the payment of P7.3 billion unpaid back taxes being collected by the Bureau of Customs covering the year 2004 up to 2009.

Shell said that excise taxes apply only to finished products for local consumption.

Shell agreed to post a surety bond worth P7.35 billion to enable them to continue the importation of their petroleum products. (PNA)

http://www.pna.gov.ph/index.php?idn=...d=3&rid=269607

[hakz2007]

BIR names Pacquiao, Kris Aquino among top 20 taxpayers

MANILA, April 14 (PNA) – The Bureau of Internal Revenue (BIR) on Wednesday named Filipino boxing champion Emmanuel “Manny” Pacquiao and television host Kristine Bernadette “Kris” Aquino-Yap as among the top 20 individual taxpayers based on income tax due for taxable year 2008.

BIR Commissioner Joel L. Tan-Torres said Pacquiao, who ranks number one on the list of taxpayers, paid his taxes on time which costs more than P1 billion.

But the BIR chief did not give the exact amount paid by Pacquiao saying it is “confidential.”

“Well, all I can say is the boxing champ paid a nine digit figure, close to more than a billion,” Tan-Torres said when pressed by the Philippines News Agency (PNA) for the exact amount during a press briefing at the BIR Main Office in Diliman, Quezon City.

The BIR chief said the average amount paid by each of the rest of the top 20 taxpayers amounts to P28.5 million.

Pacquiao is currently the World Boxing Organization (WBO) welterweight champion after he beat Joshua Clottey last March 2010 in Nevada, United States.

"This is our way of recognizing the tax contribution efforts of the taxpayers. We hope they will serve as role models for others to emulate," he said.

Construction magnate Elaine Bautista Gardiola is the second top taxpayer. Licensed broker Ronaldo Romero Soliman follows in third. Rainero Manapat Borja are in third and fourth.

At number five is Lauro L. Baja Jr. with television host Wilfredo "Willie" Buendia Revillame at sixth place followed by Francisco dela Fuente Guerra IIII. Yap-Aquino is number eight.

Patricia Miranda Zobel de Ayala and Manuel Bayan Zamora Jr. are ninth and tenth placers. At 11th to 15th are Eduardo Murphy Cojuangco Jr., business tycoon Manuel Velez Pangilinan, Beatriz Susana Zobel de Ayala Urquijo, Gigi Chio Ibasco, and Manuel Moreno Lopez.

And 16th to 20th top taxpayers are Christopher Salcedo Co, Justo Aboitiz Ortiz, actor Jose Nonato "Piolo" Pascual, Ramon See Ang and Federico Rufino Lopez.

Tan-Torres said the publication of the top taxpayers lists is authorized under Section 71 of the Tax Code. He added the BIR will publish the top 300 individual and top 150 corporate taxpayers of income tax for taxable year 2009 for each of the BIR’s Revenue District Offices.

“The publication will be done after the filing deadline on Thursday, April 15, 2010,” Tan-Torres said.

Each revenue office will identify its top 300 individual and top 150 corporate taxpayers. Nationwide, the top 2,000 individual and top 1,000 corporate taxpayers will be named. (PNA)

http://www.pna.gov.ph/index.php?idn=...d=3&rid=269700

[hakz2007]

BIR worried about a decline in April tax collection

INTERNAL Revenue Commissioner Joel Tan-Torres said he worries about his agency’s April tax collections as income tax filers are expected to submit billions of pesos in losses due to typhoons Ondoy and Pepeng today, the deadline for filing of income tax covering last year.

Tan-Torres estimates that the deductions of the typhoon claims may slash the agency’s income for the month by about P7 billion to P9 billion.

“We expect all casualty losses to be claimed, but we don’t know how many of them will do it,” Tan-Torres said in a news conference on Wednesday.

For April, BIR has a target collection of P86.2 billion, one of the highest monthly targets of the agency, where two-thirds of the national government income comes from.

So far, as of April 9, BIR has collected about P3 billion, but a bulk of its collections will arrive by today when companies and individuals will have to pay taxes that they have not remitted to the government for its activities last year.

On April 15 last year BIR collected P18.1 billion, one of the biggest collections in a single day.

“But we will be very strict on the requirements [on typhoon claims] and all those who have claimed will be subject to mandatory audit,” he said.

BIR expects about half-a-million taxpayers or filers to troop to their offices today, and Tan-Torres said BIR can handle the transactions as the agency has doubled the capacity of its computers since last year.

Tan-Torres said, however, that he worries about a brownout scenario in Mindanao, which is experiencing a rotating power outage of at least 12 hours a day.

He said he had requested the Department of Energy for a brownout-free scenario, but the DOE did not make any commitment.

“If there is a brownout, we would have to resort to the manual process of collection. BIR personnel will be there to give out receipts,” Tan-Torres said.

The casualty claims are those damages that BIR allow businesses to deduct from their income tax payments. BIR received at least P24 billion worth of casualty claims from taxpayers.

Revenue Memorandum Order 31-2009 details the guidelines for the reporting of losses which was issued after typhoons Ondoy and Pepeng visited the country in September and October.

According to the order, business taxpayers have to file with their respective BIR offices sworn declarations of losses arising from casualty and other support documents deemed necessary to substantiate their proof of loss.

Tan-Torres earlier said BIR is on the lookout for companies that may deliberately place the damaged or lost personal assets in its casualty report in a move to bloat company losses and get more claims.

“The appropriate treatment of this property shall be governed by the financial accounting and tax accounting rules, and must take into account the nature of the transaction, the value of amounts involved, and other factors,” BIR said.

The sworn declaration must be supported by the taxpayer’s financial statement for the year immediately preceding the event and copies of the insurance policies, if applicable, for the properties.

For the first three months of the year, BIR said it had a surplus collection against target of P14.6 billion, collecting P172.3 billion for the period.

http://businessmirror.com.ph/index.p...ance&Itemid=61

[jpdm]

Government lays ground for VAT hike

Wednesday, 21 April 2010 00:00
BY KATRINA MENNEN A. VALDEZ Reporter
Manila Times

THE Department of Finance is laying the groundwork for a higher value-added tax (VAT) rate in exchange for a lower income tax rate, according sources privy to the plan.

A source from the technical working group formed to look into the matter said they are looking for a “perfect ratio” between the income tax rate and VAT rate that would lead to an overall increase in revenues for the government.

The source said any ratio should lead to incremental revenues above P87 billion, which is the difference between the amount raised under the old 10 percent and that generated under the current 12 percent for the VAT.

“We are currently waiting for the Bureau of Internal Revenue’s [BIR] data filed last year for the 2008 income tax returns of individuals and corporations in order to complete the computation as to the 12 percent VAT,” the source said.

The computation is aimed at determining the revenue impact of various scenarios that involve tweaking the individual and corporate tax rates.

Finance Undersecretary Gil Beltran said the “proposal is still under study and computation,” without elaborating.

Another senior finance official involved in the study said raising the VAT rate and lowering the income tax rate would put individuals and companies “on a fair and equal footing since they would be paying more for what they consume without incurring substantial lesions on their respective incomes.”

BIR Commissioner Joel Tan-Torres earlier recommended a “no touch” policy on the existing 12 percent VAT after Finance Secretary Margarito Teves recommended that the next administration raise the rate to 15 percent.

Tan-Torres had said this proposal may generate a public backlash, since this would mean raising the unpopular VAT rate while giving relief to big businesses.

The corporate income tax had been reduced to 30 percent from 35 percent effective last year.

Tan-Torres said any move to tweak tax rates should review unsuccessful moves, such as the Optional Standard Deduction (OSD), which ended up trimming government revenues by P6 billion. The OSD was outlined in Republic Act 9504, or the same law that exempted minimum-wage earners from income tax payments.

[296619]

Originally Posted by Askal82

I just wonder how come Sy, Go, Tan and the Ayala's are not in the top 10 taxpayers while they are in the billionaire's list. What's even odder is that Villar is not there too.

hi.. Ilang years na po ba silang wala dun?... Baka naman kaya hindi sila kasali kasi yung mga individual tax payer lang ang laman nung list, and yung mga company nila Villar, Tan, Sy ang taxable hindi sila personally. Pero once na natangap na nila yung dividend nila, subject yun sa Dividend tax, and individual income tax. Tama po ba?... Kaya lang kasi, ang mga corporation e hindi naman sila ganun kalaki mag declare ng dividends, lalo na pag expanding yung corporation...

[Askal82]

Originally Posted by 296619

hi.. Ilang years na po ba silang wala dun?... Baka naman kaya hindi sila kasali kasi yung mga individual tax payer lang ang laman nung list, and yung mga company nila Villar, Tan, Sy ang taxable hindi sila personally. Pero once na natangap na nila yung dividend nila, subject yun sa Dividend tax, and individual income tax. Tama po ba?... Kaya lang kasi, ang mga corporation e hindi naman sila ganun kalaki mag declare ng dividends, lalo na pag expanding yung corporation...

Yeah, wala nga sa dividends pero sa salaries + bonuses nila pwede dun pumatak.

[296619]

Originally Posted by Askal82

Yeah, wala nga sa dividends pero sa salaries + bonuses nila pwede dun pumatak.

If they are an employee of thier own company which for sure they are not. Why? matatalino yang mga yan. Bakit sila mismo magiging employee kung pwede naman iba, besides hindi sila madodouble tax pag hindi sila employee...

[Askal82]

Originally Posted by 296619

If they are an employee of thier own company which for sure they are not. Why? matatalino yang mga yan. Bakit sila mismo magiging employee kung pwede naman iba, besides hindi sila madodouble tax pag hindi sila employee...

Don't tell that to the CEO's of the big American corporations. Salaries and payroll expenses are deductible from the company's gross income and its quick money compared to waiting for their dividends to arrive.

On top of that, the withholding taxes that carries along with those big salaries and bonuses by these people can be used to offset any of their income tax declaration from that year, shielding them further from income taxation or sometimes would result into a credit or refund.

I'm not sure if the BIR have certain limits on the salaries expenses they can claim and what amount is considered dividends so they can be taxed appropriately.

Another way of doing this would be establishing ghost corporations with interrelated and complex ownership structures (ala Lucio Tan style) with these companies where the expenses of their invisible subsidiaries are deducted twice from the parent and from the subsidiary, resulting to minimum income declared for taxes.

These businesses are slick and the corruption taking place in the BIR seems to have a lot of problems catching them. A lot more reforms are necessary to make these entities transparent so they can be taxed appropriately. I'm about to see laws being passed and enforced regarding inter related party transactions and the limitations of salaries expense being claimed by the board of directors and owners of these companies.

[296619]

Originally Posted by Askal82

Don't tell that to the CEO's of the big American corporations. Salaries and payroll expenses are deductible from the company's gross income and its quick money compared to waiting for their dividends to arrive.

On top of that, the withholding taxes that carries along with those big salaries and bonuses by these people can be used to offset any of their income tax declaration from that year, shielding them further from income taxation or sometimes would result into a credit or refund.

I'm not sure if the BIR have certain limits on the salaries expenses they can claim and what amount is considered dividends so they can be taxed appropriately.

Another way of doing this would be establishing ghost corporations with interrelated and complex ownership structures (ala Lucio Tan style) with these companies where the expenses of their invisible subsidiaries are deducted twice from the parent and from the subsidiary, resulting to minimum income declared for taxes.

These businesses are slick and the corruption taking place in the BIR seems to have a lot of problems catching them. A lot more reforms are necessary to make these entities transparent so they can be taxed appropriately. I'm about to see laws being passed and enforced regarding inter related party transactions and the limitations of salaries expense being claimed by the board of directors and owners of these companies.

...

Hi!...

I'm sorry but we're talking about businessmen here in the Philippines...

Well for the case of Lucio Tan, Henry Sy, and Villar... For sure, hindi lang naman yang dividend ang hinihintay nila, malamang may pera yan sa banko na nakadeposit at naghihintay lang ng interest kaya hindi nila kelangang maging employee? hehe....

Yes. there is certain limit on the salary of the employees. On a stockholder's case, who is at the same time, an employee of the company, he can only receive a reasonable amount of salary and any excess amount will be considered disguise dividend.

Pero tama ka, aside from being a major stockholder, I would rather be an employee too. Actually I was about to edit what i posted earlier, kaya lang biglang nag off PC ko. . Hindi ko lang sure kung halimbawang ako ang major stockholder ng corporation, at ako ang chairman of the board, automatic ba na ako rin ang President?

The point why Lucio Tan, Henry Sy, and Villar are not included in the list is that, thier company is the one profiting not themselves as individuals. If they are working for thier own respective companies, they will be receiving a salary which for sure is lesser than what Manny Pacquia or Kris Aquino earns...

[296619]

By the way, I do not totally agree with you. You're correct about the corruption, but not with the withholding taxes. A certain amount is being witheld to an employee everytime he submits his quarterly income tax return but, it is the final income tax that determines if you will be included in the rank or not. So, you have to total all the income tax you paid for the four quarters of the year.

[296619]

And your claim about the twice deduction, one from parent and one from subsidiary is not allowed by the Tax Code.

[Askal82]

Originally Posted by 296619

And your claim about the twice deduction, one from parent and one from subsidiary is not allowed by the Tax Code.

I'm not making a statement about the deduction claimed by any one of the legit interrelated companies. I was talking about the ghost companies that they would potentially create for that particular purpose. In addition, I'm actually confirming about any comprehensive tax laws that covers that issue and you did answer that.

[296619]

Originally Posted by Askal82

I'm not making a statement about the deduction claimed by any one of the legit interrelated companies. I was talking about the ghost companies that they would potentially create for that particular purpose. In addition, I'm actually confirming about any comprehensive tax laws that covers that issue and you did answer that.

Hi... I can't imagine a scenario where a ghost corp would benefit the mother company or another company for Tax purposes because one company with subsidiaries would have to file one consolidated Financial Statement and Tax return. If two companies are interrelated, there are certain transactions that they cannot enter into. Only arms-length or transactions with unrelated companies will be considered. Even a ghost corp is not allowed, in the sense that it would still be considered a related company, unless you bribe the auditors. So it still boils down to corruption to which I agreed with you.

[hakz2007]

RP negotiates tax treaty with Syria

MANILA, May 2 (PNA) -- The Philippines is scheduled to hold negotiations for a tax treaty with Syria on May 4-7, 2010 at the Bureau of Internal Revenue (BIR) in Quezon City.

Bureau of Internal Revenue (BIR) Commissioner Joel L. Tan-Torres will head the Philippine panel while Naeem Al Masri, adviser from the Syrian Ministry of Finance, heads the other side.

Deputy BIR Commissioner Gregorio V. Cabantac of the Legal and Inspection Group and Legal Service OIC-Assistant Commissioner Marissa O. Cabreros will serve as vice-chairpersons for the Philippine delegation.

The tax treaty is expected to bolster business investments between the Philippines and Syria.

Business enterprises in the Philippines with investments or business dealings in Syria are encouraged to submit their tax concerns to the International Tax Affairs Division of the BIR for consideration by the Philippine Tax Treaty panel. (PNA)

http://positivenewsmedia.net/am2/pub...th_Syria.shtml

[kiretoce]

Originally Posted by hakz2007

BIR names Pacquiao, Kris Aquino among top 20 taxpayers
http://www.pna.gov.ph/index.php?idn=...d=3&rid=269700

Why are they so obsessed with lists/rankings in the Philippines?

[RonnieR]

Originally Posted by kiretoce

Why are they so obsessed with lists/rankings in the Philippines?

BIR thinks that it will encourage other rich Pinoys to pay the correct taxes. BIR knows that there are so many rich Pinoys who don't pay the right amount of taxes.

[kiretoce]

And I guess making it to that list give you a certain air of elegance and prestige above any one else.

[jpdm]

IMF endorses govt plan to raise VAT, cut income taxes


Tuesday, 04 May 2010 00:00
BY KATRINA MENNEN A. VALDEZ Reporter
Manila TImes

The International Monetary Fund (IMF) has endorsed a Philippine government plan to cut its income tax rate and raise its sales tax, according to the Department of Finance.

Finance Undersecretary Gil Beltran said the IMF agreed to a government proposal to increase the value-added tax (VAT) rate from 12 percent to 15 percent provided that the income tax rate would be reduced to 21 percent from the current 30 percent.

Beltran and other Philippine economic officials presented their plan before representatives of the multilateral lender during the annual IMF-World Bank spring meeting.

“Since a lower income tax rate and higher VAT rate is the norm in almost all developing countries, IMF has said that it is a strategic move for us in order to boost tax efficiency collection,” Beltran said.

The finance official said it is easier for the Bureau of Internal Revenue (BIR) to collect VAT, so raising the rate would bring more revenues to the government.

He said the higher VAT-cum-lower income tax plan was based on the proposal of economics professors from the University of the Philippines.

“Of course, we still have to come up with our own formula as to the lowering of the income tax rate versus the planned 15 percent VAT,” Beltran said.

On April 21, The Manila Times reported that the finance department is laying the ground for a higher VAT rate in exchange for a lower income tax rate, with the formation of a technical working group that would look for the “perfect ratio” leading to an overall increase in government revenues.

The BIR subsequently confirmed that it was already sending data to the committee tasked with coming up with the best scenario.

Prepare for an exit
Beltran also said that the IMF advised the Philippines to prepare for the global economy’s exit from the worst crisis in decades.

He said the Philippines was advised to extricate itself from economic slowdown since failing to do so would bring inflation and interest rates above official ceilings.

“We were told to prepare for an exit since according to them, developing countries are inevitably reaching the end of the tunnel of recession,” Beltran said.

“If we cannot prepare as early as now, then lenders would increase their interest rates since the government and the private sector would flood them. A rise in the demand would push the interest rate and inflation up,” he said.

The finance official said the Philippines could likely bounce back to its post-Asian financial crisis growth of 5.5 percent.

The government has estimated that every one percent rise in the country’s gross domestic product (GDP) would equate to a P13 billion increase in nominal revenues. The BIR and Bureau of Customs have exceeded their respective collection targets for the first three months of this year, surpassing their combined tax take by P21 billion.

“Of course, this would still depend on whether the growth in the collection was derived from increase in the [tax] collection efficiency or the BIR and [Customs] are collecting more from a bigger tax base,” Beltran said.

“If the scenario is there is zero efficiency growth in tax collection, then the P21 billion [excess in tax collection] is from an expanded tax base. Thus, GDP is growing by 1 percent for every excess of P13 billion in the collection goal,” he added.

The Philippine government is forecasting between 2.6-percent and 3.6-percent GDP growth this year.

[Askal82]

Wow! These guys are simply incredible!! Maybe the ordinary Filipinos can readily afford to absorb these taxes since the remittance money keeps flowing in while allowing the wealthy bastards to get away with it much easier with their reduced income tax rates. 12 to 15%?!?!? Ouch!

Originally Posted by RonnieR

BIR thinks that it will encourage other rich Pinoys to pay the correct taxes. BIR knows that there are so many rich Pinoys who don't pay the right amount of taxes.

Some sort of a role model material.

Originally Posted by kiretoce

And I guess making it to that list give you a certain air of elegance and prestige above any one else.