TAX & BUSINESS-RELATED NEWS [APRIL 18-19] BIR CLARIFIES THE DEADLINE OF SUBMISSION OF ATTACHMENTS TO THE 2021 ANNUAL ITR BIR DISPENSES THE REQUIREMENT OF AFS FOR CDA-REGISTERED ENTITIES WITH GROSS SALES OR RECEIPTS OF LESS THAN PHP 3 MILLION FOR RENEWAL OF CERTIFICATE OF TAX EXEMPTION TAX & BUSINESS-RELATED NEWS [APRIL 11-17] COURT OF TAX APPEALS CASES DIGEST
| 1. TAX & BUSINESS-RELATED NEWS [APRIL 18-19] | | 'Congressional action' needed to rename NAIA, says Palace Qatar Airways in hiring mode in PH PAL eyes resuming 100 percent pre-pandemic capacity this year Half of young Filipinos considering changing jobs Social media registration should be separate from SIM card registration, says lawmaker BSP tells public: Don't buy P20, P5 coins at higher prices online PH loses as DOE halts oil search, says expert Economists urge G20 set up register to track oligarchs P90-M payment for Smartmatic’s services withheld until data breach issue is resolved–Comelec chair PLDT sells 5.9k telco towers for P77-B to two towercos, leases them back for 10 yrs Strategic Investment Priority Plan undergoes significant makeover Coconut industry defies pandemic with 'tremendous sales growth': stakeholder Telcos blocked over a billion attempts to access porn sites Online sellers, platforms warned vs selling substandard products Ninja Van Philippines automates largest hub in Cabuyao to meet the country's growing delivery demand Fintech startup NextPay seeks to join popular e-wallets in crypto race Philippines violated 5 articles of migrant workers pact — report Phinma eyes SE Asia school acquisitions, property deals in PH Strong auto sales in March boost Q1 performance to 6.3% Shares in Chinese maker of 'Lianhua Qingwen' tank as COVID medicine questioned NLEX seeks TRB go signal for C3-Anda Circle expressway project Support for investment promotion agencies hit P58-B from 2017-2021: DOF
| We saw these tax and business-related news on various news sites, and we thought you should see them. DMD is not responsible for the content of these news, and anything written thereon does not necessarily reflect DMD views or opinions. | 'Congressional action' needed to rename NAIA, says Palace [ABS-CBN News, April 19, 2022] This, after the Duterte Youth's party-list representative authored House Bill No. 10833 to rename NAIA, claiming the name was "highly politicized." Qatar Airways in hiring mode in PH [Inquirer Mobile, April 19, 2022] With leisure travel seen gaining momentum, Qatar Airways has started recruiting additional cabin crew, lounge staff and contact center employees in Manila, Cebu, Clark and Davao this month. PAL eyes resuming 100 percent pre-pandemic capacity this year [ABS-CBN News, April 19, 2022] In a briefing, Ng said PAL now has reached 80 percent capacity in domestic travel compared to the pre-pandemic level and about 60 percent in terms of international flights. Half of young Filipinos considering changing jobs [Inquirer Mobile, April 19, 2022] The top reasons employees quit were personal well-being or mental health, work-life balance, risks of getting COVID-19, lack of confidence in senior leaders and lack of flexible work hours or location. Social media registration should be separate from SIM card registration, says lawmaker [ABS-CBN News, April 19, 2022] Muntinlupa Representative Ruffy Biazon, one of the bill’s proponents, said social media registration needs to be discussed in greater detail because the bill vetoed by President Rodrigo Duterte did not give details on the process of registering social media accounts. BSP tells public: Don't buy P20, P5 coins at higher prices online [ABS-CBN News, April 19, 2022] "The Bangko Sentral ng Pilipinas (BSP) reminds the public that the 20-Piso and enhanced 5-Piso coins are still in circulation, and should not be bought at prices higher than their respective face value from online sellers," the central bank said. PH loses as DOE halts oil search, says expert [Philippine Daily Inquirer, April 19, 2022] The DOE order effectively stopped “all exploration activities” for Service Contracts 72 and 75—two sites off Palawan province earlier identified by the government as possible areas of joint energy exploration with Beijing—pending a go-signal from the Security, Justice and Peace Coordinating Cluster (SJPCC) which cited “the political, diplomatic and national security implications of any activity in the West Philippine Sea.” Economists urge G20 set up register to track oligarchs [ABS-CBN News, April 19, 2022] Leading economists Tuesday urged G20 leaders to draw up a world asset register for tracking tax evaders that could pressure Russia over the Ukraine invasion by exposing oligarchs' hidden wealth. P90-M payment for Smartmatic’s services withheld until data breach issue is resolved–Comelec chair [Manila Bulletin, April 19, 2022] The Commission on Elections (Comelec) on Tuesday, April 19 told a Senate committee that it has decided to withhold a P90-million payment for the services to Smartmatic, its automated elections technology provider, whose data were allegedly breached as the May 9, 2022 election approaches. PLDT sells 5.9k telco towers for P77-B to two towercos, leases them back for 10 yrs [ABS-CBN News, April 19, 2022] Smart Communications and Digitel Mobile Philippnes Inc, which are PLDT subsidiaries, signed deals to sell the telco towers and related passive telecom infrastructure, to tower companies edotco and EdgePoint, PLDT said. Strategic Investment Priority Plan undergoes significant makeover [Manila Bulletin, April 19, 2022] The CREATE Law provides for the creation of the Strategic Investment Priority Plan (SIPP) that will replace the current Investment Priorities Plan (IPP), being administered by the Board of Investments. While the SIPP is still being finalized, the 2020 IPP serves as the transition SIPP. Coconut industry defies pandemic with 'tremendous sales growth': stakeholder [ABS-CBN News, April 19, 2022] The coconut industry has been growing "tremendously" in the past two years despite the COVID-19 pandemic, which underscores the importance of coconut products, Axelum Resources Corp president and COO Henry Raperoga said Tuesday. Telcos blocked over a billion attempts to access porn sites [Manila Bulletin, April 18, 2022] PLDT Inc. and Smart Communications Inc. have blocked over a billion user attempts to access online child sexual abuse materials (CSAM) in the past six months. Online sellers, platforms warned vs selling substandard products [Inquirer Mobile, April 18, 2022] There are currently 87 kinds of products deemed to affect consumer and environmental safety that are under the DTI’s mandatory list, including electric fans, ceramic tiles and air conditioners. Ninja Van Philippines automates largest hub in Cabuyao to meet the country's growing delivery demand [Manila Bulletin, April 18, 2022] Ninja Van Philippines, a tech-enabled logistics company, continues to strive for operational excellence to better meet the needs of its customers nationwide. Along with improving delivery speed and strengthening its core services, the company has installed new sortation systems in its new automated hub in Cabuyao, Laguna. This is the Ninja Van Group’s largest automated hub and sortation system, spanning 21,000 square meters. Fintech startup NextPay seeks to join popular e-wallets in crypto race [Inquirer Mobile, April 18, 2022] Another local financial technology (fintech) firm is eyeing to join the cryptocurrency bandwagon given the heightened interest for digital assets sparked by the rise of play-to-earn online games, including the popular Axie Infinity, and nonfungible tokens. Philippines violated 5 articles of migrant workers pact — report [Manila Bulletin, April 18, 2022] A global network of Filipino migrant organizations said the Philippines violated five rules of an international convention that aims to provide guidelines and strengthen the protections of migrant workers and their families. Phinma eyes SE Asia school acquisitions, property deals in PH [Inquirer Mobile, April 18, 2022] Phinma Corp., the listed diversified group led by businessman Ramon del Rosario Jr., is gearing up for further expansion in 2022 as it plans to acquire more schools in the country and Southeast Asia while exploring new property ventures under its real estate arm. Strong auto sales in March boost Q1 performance to 6.3% [Manila Bulletin, April 18, 2022] Domestic motor vehicle sales in the first quarter this year improved by 6.3 percent with sales reaching 74,754 units on strong 43.4 percent sales growth for the month of March, negating the significant decline in passenger cars, official industry data showed. Shares in Chinese maker of 'Lianhua Qingwen' tank as COVID medicine questioned [ABS-CBN News, April 18, 2022] Shares in one of China's largest traditional medicine producers plunged on Monday after reports questioned the efficacy of pills approved by the government as a coronavirus treatment. NLEX seeks TRB go signal for C3-Anda Circle expressway project [BusinessWorld, April 18, 2022] NLEX Corp. is awaiting approval from the Toll Regulatory Board (TRB) for the implementation of the first section of the proposed P92-billion NLEX-CAVITEX Port Expressway Link project. Support for investment promotion agencies hit P58-B from 2017-2021: DOF [ABS-CBN News, April 18, 2022] The Fiscal Incentives Review Board has released a total of P58 billion in budgetary support for investment promotion agencies (IPAs) from 2017 to 2021, the Finance Department said Monday. | 2. BIR CLARIFIES THE DEADLINE OF SUBMISSION OF ATTACHMENTS TO THE 2021 ANNUAL INCOME TAX RETURN | Revenue Memorandum Circular (RMC) No. 46-2022, issued on April 18, 2022, clarifies that the deadline of the submission of attachments to the 2021 Annual Income Tax Return (AITR) is on or before May 31, 2022, whether the electronically filed AITR is an original or an amended return. The submission shall be made manually to the BIR where the taxpayer is registered or electronically through the Electronic Audited Financial Statements (eAFS) System. | 3. BIR DISPENSES THE REQUIREMENT OF AFS FOR CDA-REGISTERED ENTITIES WITH GROSS SALES OR RECEIPTS OF LESS THAN PHP 3 MILLION FOR RENEWAL OF CERTIFICATE OF TAX EXEMPTION | Revenue Memorandum Circular (RMC) No. 48-2022, issued on April 20, 2022, clarifies that cooperatives registered under the Cooperative Development Authority (CDA) whose gross annual sales, receipts, or earnings do not exceed the threshold of Php 3 Million shall not be required to submit an Audited Financial Statements (AFS) for renewal of Certificate of Tax Exemption (CTE) purposes. It may be recalled that the Tax Reform for Acceleration and Inclusion (TRAIN) Law amends Section 232 of the 1997 Tax Code specifically on the requirement of keeping books of accounts audited and examined by independent Certified Public Accountant (CPA) for taxpayers whose gross annual sales, receipts, or earnings do not exceed Php 3 Million. | 4. TAX & BUSINESS-RELATED NEWS [APRIL 11-17] | | TESDA among most trusted gov’t agencies in PUBLiCUS Asia survey Mindanao oil firm eyes drilling of 2 rigs Russia may be in default, Moody’s says Zarate: SIM card registration bill would give government ‘Big Brother’ powers Ferrero to stop buying palm oil from Malaysia’s Sime Darby over labor concerns Largest BPO companies in the Philippines by employee count Ayala-led logistics firm eyes nationwide footprint Tighter rules for online lending platforms on the way, says SEC DILG tells LGUs: Enact ordinances to prevent power line obstructions Vegas, Macau…Dubai? Global casinos raise bets on gambling in the Gulf GSIS to offer better loan program starting April 23 DOF: Lifestyle checks yield 77 ‘corrupt’ employees Meta to activate elections operation center in the country
| We saw these tax and business-related news on various news sites, and we thought you should see them. DMD is not responsible for the content of these news, and anything written thereon does not necessarily reflect DMD views or opinions. | TESDA among most trusted gov’t agencies in PUBLiCUS Asia survey [Manila Bulletin, April 17, 2022] The first quarter survey of PUBLiCUS Asia showed that the Technical Education and Skills Development Authority (TESDA) is still one of the most trusted government agencies. Mindanao oil firm eyes drilling of 2 rigs [The Philippine Star, April 17, 2022] Mindanao-based exploration firm SK Liguasan Oil and Gas Corp. (SKLOGC) is looking to acquire two rigs to start drilling in six to eight months after securing a service contract from the government. Russia may be in default, Moody’s says [Inquirer Mobile, April 16, 2022] Moody’s said Russia may be in default because it tried to service its dollar bonds in roubles, which would be one of the starkest consequences to date of Moscow’s exclusion from the Western financial system since President Vladimir Putin’s invasion of Ukraine. Zarate: SIM card registration bill would give government ‘Big Brother’ powers [ABS-CBN News, April 16, 2022] House Deputy Minority leader Carlos Isagani Zarate said the proposed law contradicted Filipinos' right to privacy and free speech. He was among those who voted against it in the lower chamber. Ferrero to stop buying palm oil from Malaysia’s Sime Darby over labor concerns [Inquirer Mobile, April 16, 2022] Italian confectionary giant Ferrero said it will stop sourcing palm oil from Sime Darby Plantation after the United States found the Malaysian planter used forced labor, in a reputational blow for the palm producer and for Malaysia. Largest BPO companies in the Philippines by employee count [Yugatech, April 15, 2022] With over 1.4 million workers employed in information technology-business process outsourcing (IT-BPO) firms to date, this sector is regarded as one of the largest employment generators in the Philippines. Along with electronics, it has become one of the more robust export industries of the country in the past two decades. While BPOs adjust with the transition towards the New Normal, growth has continued in this sector in the midst of the pandemic. Ayala-led logistics firm eyes nationwide footprint [Inquirer Mobile, April 14, 2022] Ayala-led BRAD Warehouse and Logistics Services Inc. has set its sights outside Metro Manila and nearby provinces to reach out to more small and medium enterprise (SME) customers this quarter, which is in line with its goal of having a nationwide presence. Tighter rules for online lending platforms on the way, says SEC [Inquirer Mobile, April 14, 2022] The SEC said in a statement that Google, which runs one of the world’s largest app stores, will start requiring online lending platforms targeting users in the Philippines to prove they are duly registered with the corporate regulator on May 11. DILG tells LGUs: Enact ordinances to prevent power line obstructions [Manila Bulletin, April 13, 2022] The Department of the Interior and Local Government (DILG) urged the local government units (LGUs) on Wednesday, April 13 to pass measures that will deter any obstructions and hazardous activities within the power line corridors (PLCs) in their respective areas. Vegas, Macau…Dubai? Global casinos raise bets on gambling in the Gulf [Inquirer Mobile, April 13, 2022] The announcements could mark a watershed moment for the Gulf, a region that has traditionally imposed stricter Islamic rules than other parts of the Middle East, and one where gambling has long been off-limits. GSIS to offer better loan program starting April 23 [Inquirer Mobile, April 13, 2022] The state-run pension fund Government Service Insurance System (GSIS), beginning April 23, will offer a member loan program with a higher credit limit, longer repayment period, as well as easier application requirements. DOF: Lifestyle checks yield 77 ‘corrupt’ employees [Inquirer Mobile, April 13, 2022] Lifestyle checks conducted among 468 employees working in agencies being overseen by the Department of Finance (DOF)—including the country’s two biggest tax-collectors—resulted in 77 personnel reprimanded for alleged corruption. Meta to activate elections operation center in the country [Manila Bulletin, April 11, 2022] Just in time for the May 9th Philippine General Elections, Meta will be activating an Elections Operation Center in the country to monitor critical issues and respond to emerging risks in real-time. Meta, the parent organization of Facebook, Instagram, and WhatsApp shared this news during a press briefing last Thursday. | 5. COURT OF TAX APPEALS CASES DIGEST ON VOID ASSESSMENT DUE TO ABSENCE OF LOA & UNAUTHORIZED RECEIPT, DENIED INPUT VAT REFUND | [ISSUANCE OF A VALID LOA IS AN ESSENTIAL PART OF THE DUE PROCESS RIGHTS OF A TAXPAYER RELATIVE TO THE CONDUCT OF AN EXAMINATION OR ASSESSMENT] [RDO IS NOT ONE OF THE AUTHORIZED REPRESENTATIVES OF THE CIR TO ISSUE LOA] Petitioner Commissioner of Internal Revenue (CIR) filed a Petition for Review seeking to cancel the CTA 2nd Division’s earlier decision. Petitioner argued that Respondent AC Corporation is estopped from assailing the authority of the persons who received the Letter of Authority (LOA) as it was never raised in the administrative level. Petitioner also contended that the assigned Revenue Officer (RO) is authorized to conduct the audit of Respondent’s books of accounts and other accounting records for taxable year 2007 pursuant to a valid Memorandum of Assignment (MOA). Respondent agreed with the ruling of the Court in Division that the LOA is void because it was received by an unauthorized person. It also countered that the assigned RO was not authorized to continue the audit by the mere issuance of a MOA which was signed by a Revenue District Officer (RDO). In ruling, the Court agreed with the Petitioner that the principle of estoppel applies in this case, but by way of laches. Records showed that Respondent never questioned the lack of an LOA in its protest letters. At the very least, Respondent should have requested for an LOA, if it was true that it did not receive any copy thereof from the alleged “unauthorized” security guard before it allowed the ROs to examine any of its accounting records. This notwithstanding, the Court found the deficiency tax assessments void for lack of authority of the RO who continued the audit examination of Respondent’s tax records. The assigned RO was not named in the original LOA but was assigned to continue the audit by way of a MOA signed by the RDO who is not one of the officials tasked to issue LOAs. The Court held that the said MOA does not pass the test of validity, hence, the assessments issued as a result thereof, are void. Consequently, the Petition was DENIED. [COMMISSIONER OF INTERNAL REVENUE VS. AC CORPORATION, CTA EB CASE NO. 2279, FEBRUARY 28, 2022] IN A CLAIM FOR TAX REFUND OR TAX CREDIT, THE APPLICANT MUST PROVE NOT ONLY ENTITLEMENT TO THE GRANT OF THE CLAIM UNDER SUBSTANTIVE LAW; IT MUST ALSO SHOW SATISFACTION OF ALL THE DOCUMENTARY & EVIDENTIARY REQUIREMENTS FOR AN ADMINISTRATIVE CLAIM FOR REFUND OR TAX CREDIT Petitioner Yilan Holdings Co., Inc. filed a Petition for Review assailing the CTA 3rd Division’s earlier decision, which denied Petitioner’s claim for refund if input VAT arising from the domestic purchase of taxable goods and services, capital goods, and domestic purchases of goods other than taxable goods, allegedly attributable to effectively zero-rated sales. Petitioner asserted that it purchased two (2) parcels of land, which were subsequently leased to a PEZA-registered enterprise, under a Contract of Lease. Such lease should be treated as a VAT zero-rated sale. Petitioner also claimed that it reflected its income from the Contract of Lease in its subsequent VAT returns. In ruling, the Court affirmed the 3rd Division’s findings that Petitioner’s lease transactions may qualify for VAT zero-rating. However, despite being entitled to VAT zero-rate, Petitioner failed to show proof of VAT zero-rated sales when it failed to present the VAT official receipts issued for such lease transactions. The entitlement to claim for tax credit or refund of creditable input tax due or paid is conditioned on the existence of zero-rated or effectively zero-rated sales. Unfortunately, upon careful examination of the records, Petitioner failed to submit any VAT official receipt for the said lease transactions to prove the existence of its alleged zero-rated or effectively zero-rated sales. Compliance with the invoicing requirements is clearly mandatory, failure to comply therewith is fatal to Petitioner's claim for refund. In light of the absence of zero-rated or effectively zero-rated sales, it is unnecessary to discuss Petitioner's compliance or non-compliance with the other requirements for this claim for issuance of tax credit certificate or refund of unutilized input VAT. Hence, the Petition was DENIED for lack of merit. [YILAN HOLDINGS COMPANY, INC. VS. COMMISSIONER OF INTERNAL REVENUE, CTA EB CASE NO. 2307, FEBRUARY 28, 2022] [THE RUNNING OF THE THREE (3)-YEAR PERIOD TO COLLECT SHALL BE SUSPENDED WHEN THE TAXPAYER REQUESTS FOR REINVESTIGATION & THE CIR GRANTS THE SAME] [TO PROVE THE FACT OF MAILING, IT IS ESSENTIAL TO PRESENT THE REGISTRY RECEIPT & THE REGISTRY RETURN CARD ISSUED BY THE POSTMASTER OF THE BUREAU OF POSTS BEARING THE SIGNATURE OF THE RECIPIENT TAXPAYER OR ITS DULY AUTHORIZED REPRESENTATIVE SIGNIFYING RECEIPT OF THE SUBJECT MAIL MATTER] Petitioner Commissioner of Internal Revenue (CIR) filed a Petition for Review seeking nullification of the CTA 1st Division’s earlier decision cancelling the assessments issued to Respondent First Far East Development Corporation. Petitioner insisted that he granted the Respondent’s request for reinvestigation thru the Notice of Hearing issued on April 5, 1994. Hence, the period to assess and collect the subject taxes has not yet prescribed. In ruling, Section 203 of the Tax Code, as amended, provides that the government is mandated to assess internal revenue taxes within three (3) years after the return was filed. Hence, an assessment notice issued after the said three-year prescriptive period is no longer valid and effective. Here, Respondent was assessed for deficiency taxes for taxable year 1990 and the assessment notices were received on May 25, 1993. Respondent filed on June 21, 1993 a protest letter on the assessments with a request for reinvestigation. Said protest was followed by another protest on December 3, 1993. Then, on October 9, 2007, it filed a supplemental protest praying for the cancellation of the tax assessments on the ground of prescription. Thereafter, on August 17, 2017, Respondent received the CIR's Decision denying its protest. Petitioner insisted that the prescriptive period was validly extended when he granted the request for reinvestigation thru the Notice of Hearing dated April 5, 1994 mailed to Petitioner. However, there was no clear evidence to verify that a Notice of Hearing was indeed issued, mailed, and received by Respondent. Hence, Petitioner cannot collect the subject deficiency taxes because there was no competent evidence to prove that indeed Respondent's request for reinvestigation was granted by the CIR. Thus, the three-year prescriptive period for collecting from Petitioner the deficiency taxes for taxable year 1990 has prescribed. Consequently, the Petition was DENIED for lack of merit. Petitioner was ENJOINED and PROHIBITED from collecting the assessment from the Respondent. [COMMISSIONER OF INTERNAL REVENUE VS. FIRST FAR EAST DEVELOPMENT CORPORATION, CTA EB CASE NO. 2354, FEBRUARY 28, 2022] | Thank you and best regards, WILLIE B. SANTIAGO Lawyer & Certified Public Accountant Tax & Corporate Services Division TL : (+632) 8 894-5892 Loc. 703 Website: https://weeklytaxupdates.getresponsesite.com/ Don Jacinto Building De la Rosa corner Salcedo Streets Legaspi Village, Makati City 1229 Philippines | | |
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