TAX & BUSINESS-RELATED NEWS [JUNE 2-7] CTA CASES DIGEST TAX & BUSINESS-RELATED NEWS [MAY 29-JUNE 1]
| 1. TAX & BUSINESS-RELATED NEWS [JUNE 2-7] | | From director to researcher: Taxman who threatened to shut down Megaworld placed in freezer weeks before retirement 5 ARTA officials suspended for six months Grab rolls out loan program to help MSMEs Mariah Carey is sued over ‘All I Want for Christmas Is You’ Ayala logistics unit acquires Batangas land for technopark Shift to e-receipts starts in July — BIR SC junks Mel Tiangco’s appeal vs ABS-CBN over ‘illegal dismissal, suspension’ Study: Telcos, consumers winners in PH’s common tower policy Skechers opens biggest store in Cebu Razon set to take over Malampaya from Dennis Uy House passes bill creating CAR Return to office or leave, Elon Musk tells Tesla employees Lagot sa LTFRB! JoyRide in hot water over ‘priority boarding fee’ PH facing shortage of cybersecurity talent PLDT group receives P39B on sale of 3,012 towers Lawmaker to re-file bill suspending fuel excise tax PHL Senate fails to ratify RCEP
| 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. | From director to researcher: Taxman who threatened to shut down Megaworld placed in freezer weeks before retirement [Bilyonaryo, June 6, 2022] Pagulayan was placed on floating status just three weeks after he and Deputy Commissioner Arnel Guballa issued the controversial media advisory announcing the closure of Megaworld of ultra bilyonaryo Andrew Tan. 5 ARTA officials suspended for six months [Manila Bulletin, June 5, 2022] The complaint against the ARTA officials was filed by lawyer Adel A. Tamano, administrative officer of DITO Telecommunity, Inc. Tamano accused them of alleged violations of Section 3(e) of RA 3019, the Anti-Graft and Corrupt Practices Act. Grab rolls out loan program to help MSMEs [The Philippine Star, June 5, 2022] Called Quick Cash, the program aims to lend a hand to Grab’s community of small and medium businesses. Mariah Carey is sued over ‘All I Want for Christmas Is You’ [Inquirer.Net, June 4, 2022] Mariah Carey was sued on Friday over her 1994 Christmas classic “All I Want for Christmas Is You” by a songwriter who said he co-wrote a song with the same title five years earlier. Ayala logistics unit acquires Batangas land for technopark [The Philippine Star, June 4, 2022] AyalaLand Logistics Holdings Corp. (ALLHC) has acquired 55 hectares of land in Padre Garcia, Batangas, which is set for the development of the future Batangas Technopark. Shift to e-receipts starts in July — BIR [The Philippine Star, June 3, 2022] Large-scale taxpayers, e-commerce and export firms need to start shifting to the digital issuance of invoices and receipts by July as mandated by the Tax Reform for Acceleration and Inclusion (TRAIN) Law. SC junks Mel Tiangco’s appeal vs ABS-CBN over ‘illegal dismissal, suspension’ [ABS-CBN News, June 3, 2022] “Possession of unique skills, expertise, or talent is a persuasive element of an independent contractor. It becomes conclusive if it is established that the worker performed the work according to their own manner and method and free from the principal’s control except to the result,” it said. Study: Telcos, consumers winners in PH’s common tower policy [Inquirer Mobile, June 3, 2022] Local mobile network operators could save up to $1.15 billion in terms of capital and operational expenditures until 2025 through infrastructure sharing under the common tower policy, according to a study. Skechers opens biggest store in Cebu [SunStar Cebu, June 2, 2022] BANKING on the promising prospects in the retail industry, Skechers Philippines has expanded its presence in Cebu by opening its largest store to date at the Ayala Center Cebu. Razon set to take over Malampaya from Dennis Uy [Power Philippine News, June 2, 2022] Enrique Razon-led Prime Infra Holdings said it is poised to acquire a controlling stake in the Malampaya gas-to-power project in Palawan from Udenna Corporation of Davao-based tycoon Dennis Uy. House passes bill creating CAR [Manila Times, June 2, 2022] House Bill (HB) 5687, also known as the "Cordillera Autonomous Region bill," proposes to create a politically autonomous Cordillera that reflects the hopes and aspirations of Cordillerans, as well as changes in the political, economic and technological landscape in the region. Return to office or leave, Elon Musk tells Tesla employees [Inquirer Mobile, June 2, 2022] Tesla Inc. chief executive Elon Musk has asked employees to return to the office or leave the company, according to an email sent to employees on Tuesday night and seen by Reuters. Lagot sa LTFRB! JoyRide in hot water over ‘priority boarding fee’ [Bilyonaryo, June 2, 2022] “Based on a complaint submitted to the LTFRB, it was found that Joyride Ecommerce Technologies Corp. (Joyride) was charging PhP1,000 representing one-way ride due to what is called ‘Priority Boarding Fee,’” the LTFRB said in a statement. PH facing shortage of cybersecurity talent [Inquirer Mobile, June 2, 2022] In the Philippines and the rest of Asia, the majority of the companies find it challenging to hire cybersecurity talent due to a skills shortage, which can deal a blow to business operations, according to antivirus software developer Fortinet. PLDT group receives P39B on sale of 3,012 towers [Business World, June 2, 2022] THE PLDT group announced on Wednesday the first closing on its landmark sale and leaseback towers agreement involving 3,012 telecom towers, or more than half of the towers being monetized. Lawmaker to re-file bill suspending fuel excise tax [The Philippine Star, June 2, 2022] “The suspension will bring immediate relief to our people,” Deputy Speaker Rufus Rodriguez said, following the latest imposition by oil firms of a new round of price hikes for diesel and a reduction in the cost of gasoline. PHL Senate fails to ratify RCEP [BusinessWorld, June 2, 2022] THE PHILIPPINE Senate deferred the ratification of the Regional Comprehensive Economic Partnership (RCEP), after some senators voiced concern over the lack of safeguards for the agriculture sector. | 2. CTA CASES DIGEST ON ESSENCE OF MAP & SAWT IN CWT REFUND, EXTENT OF TAX EXEMPTION OF FOREIGN GOVERNMENTS ON THEIR INVESTMENTS IN PH & FRANCHISE TAX ON LOCAL WATER DISTRICTS | [MAP AND SAWT ARE NOT REQUIRED TO SUBSTANTIATE THE CLAIM FOR CWT REFUND] [CWTS, EVEN WITHOUT THE TESTIMONY OF THE WITHHOLDING AGENT WHO ISSUED, ARE ADMISSIBLE IN EVIDENCE] Petitioner Commissioner of Internal Revenue (CIR) filed a Petition for Review seeking to reverse the CTA 3rd Division’s earlier Decision and Resolution granting the refund of the excess and unutilized Creditable Withholding Tax (CWT) in favor of the Respondent Sonoma Services, Inc. Petitioner argued that the Respondent’s failure to present the documentary requirements prescribed under Revenue Regulations (RR) No. 2-98, as amended by RR No. 2-2006, and the failure to present the CWTs are inadmissible in evidence for being hearsay, and therefore, sufficient reasons to deny refund claims. In ruling, the Court held that RR No. 2-2006 only imposes a penalty of fine for non-submission of Summary of Alphabetical List of Withholding Taxes (SAWT) and Monthly Alphabetical List of Payees (MAP) but not the outright denial of a claim for a tax refund; hence, the Petitioner has no legal basis to insist that the alleged non-submission of SAWT and MAP should result in the denial of the Respondent’s claim for refund. Furthermore, the CWTS are sufficient to prove the fact of withholding, and even without the testimony of the withholding agent or payor who issued the CWTS, the same are admissible in evidence. Thus, the Petition was DENIED, and the earlier decision and resolution were AFFIRMED. [COMMISSIONER OF INTERNAL REVENUE VS. SONOMA SERVICES, INC., CTA EN BANC NO. 2467, MAY 24, 2022] TO BE EXEMPT FROM INCOME TAX AND CONSEQUENTLY, FROM FWT, ON INCOME RECEIVED FROM INVESTMENTS OF T-BONDS, CLAIMANT MUST ESTABLISH THAT IT IS A (1) FOREIGN GOVERNMENT, OR (2) A FINANCING INSTITUTION OWNED, CONTROLLED, ENJOYING REFINANCING OR REGIONAL FINANCING INSTITUTIONS ESTABLISHED BY FOREIGN GOVERNMENTS, OR (3) AN INTERNATIONAL OR REGIONAL FINANCIAL INSTITUTION ESTABLISHED BY FOREIGN GOVERNMENTS Petitioner GIC Private Limited (formerly known as Government of Singapore Investment Corporation Private Limited) filed a Petition for Review seeking to refund the alleged erroneously withheld Final Withholding Taxes (FWT) on its investments in the Philippine Treasury Bonds (T-Bonds) for the period January 2017 to October 2018. Petitioner claimed that the interest income from its investment in Philippine T-bonds must be exempt from income tax and FWT. Pursuant to Section 32(B)(7)(a) of the 1997 Tax Code, as amended and as implemented by Section 2.57.5 of Revenue Regulations (RR) No. 2-98, income derived from investment in the Philippines in loans, stocks, bonds or other domestic securities by (a) foreign governments; (b) financing institutions owned, controlled, or enjoying refinancing or regional financial institutions established by foreign governments; and, (c) international or regional financial institutions established by foreign governments must be exempted from income tax and likewise exempt from FWT. The pieces of evidence submitted by the Petitioner established that it is a financial institution wholly-owned and controlled by the Government of Singapore and therefore, exempt from the payment of income tax and FWT on the interest income derived from its investment in the Philippine T-Bonds. To be entitled to a refund of erroneously paid taxes, the Petitioner must prove the following requisites under Section 204 (C) and 299 of the 1997 Tax Code, as amended: (1) the tax has been erroneously or illegally collected, or the penalty has been collected without the authority, and/or any sum has been excessively or in any manner wrongfully collected; and (2) the claim for refund or credit must have been filed within two (2) years from the date of payment of tax, or penalty. Such has been proven by the Petitioner having offered both testimonial and documentary evidence without any contrary evidence by the Respondent. Thus, the Petition was GRANTED, and the Respondent was ordered to REFUND in favor of the Petitioner. [GIC PRIVATE LIMITED VS. COMMISSIONER OF INTERNAL REVENUE CTA CASE NO. 10017, MAY 11,2022] [PD 198 SERVES BOTH AS LOCAL WATER DISTRICTS’S GENERAL OR PRIMARY FRANCHISE AND SPECIAL OR SECONDARY FRANCHISE] [WHAT PD 198 GRANTS TO LOCAL WATER DISTRICTS IS NOT ONLY THE RIGHT TO EXIST AS CORPORATE ENTITIES PER SE BUT ALSO THE RIGHT TO OPERATE AS PUBLIC UTILITIES] Petitioner Davao City Water District filed Petitions for Review seeking refund of the Franchise Tax payments. Petitioner claimed that a Franchise Tax could not be imposed on a non-franchisee. Likewise, franchise is not necessary for the Petitioner to operate as a water utility company. In ruling, the Court held that the term franchise as contemplated by Section 119 of the 1997 Tax Code, as amended refers to a special or secondary franchise. Section 119 pertains to the right or privilege to engage in the business of radio or television broadcasting, and also on business undertakings classified as electric, gas, or water utilities. To be liable for Franchise Tax, it is required that: (1) the taxpayer holds a franchise to engage in business activities specified under the law; (2) the taxpayer engages in the business covered by the law granting its franchise; and (3) for franchise grantees engaged in radio and/or television broadcasting, that their annual gross receipts for the preceding year does not exceed Php 10 Million. The Petitioner fulfills all these requisites. First, the Petitioner holds a franchise to operate as a water utility. Presidential Decree 198 or the Provincial Water Utilities Act of 1973 serves both as Petitioner’s general or primary franchise and special or secondary franchise. Second, there was no doubt that Petitioner is actually operating within the territorial jurisdiction of the City of Davao as a water utility company. Third, since the Petitioner is not a franchise grantee engaged in radio and/or television broadcasting, the annual gross receipts threshold requirement of Php 10 Million under Section 119 does not apply. Given that all the requisites are present, Petitioner is considered a franchise holder and, correspondingly, subject to Franchise Tax imposed thereto. The Court also found the Petitioner’s contention that a franchise is not necessary for its operation as a water utility untenable. Local water districts are considered public utilities. Being public utilities, they are required to obtain franchise for their operation as mandated by Section 11, Article XII of the Constitution. For failure of the Petitioner to establish its right to refund, the Petitions cannot be granted. Hence, the Petitions were DENIED for lack of merit. [DAVAO CITY WATER DISTRICT VS. COMMISSIONER OF INTERNAL REVENUE, CTA CASE NOS. 9138, 9139, 9140, 9141, 9142 & 9143, MAY 6, 2022] | 3. TAX & BUSINESS-RELATED NEWS [MAY 29-JUNE 1] | | SB19’s Ken issues statement on ‘Bulan’ plagiarism allegations QC distributes cash aid to over 300 small business owners Incoming DICT chief expects more competition in telco industry BSP keeps COVID-19 shield for credit card users Confirmed! MUJI to open first café in PH Outgoing Tourism chief Puyat to join Bangko Sentral as Deputy Governor Hyundai passenger cars now under new distributor SC affirms CTA ruling on tax case of Leyte hotel Converge doubles base plan from 50Mbps to 100 Philippines loses $3.6 billion in potential investments in electronics Pagcor to probe physical takeover of Okada Manila San Miguel starts construction of MRT7 depot in Bulacan Bankrupt Sri Lanka hikes taxes Bills raising pension for indigent seniors, granting tax exemption for poll workers up for Duterte's signature BSP keeps 2 percent ceiling on credit card monthly interest rate Filipinos can now visit Seoul visa-free – but there’s a catch Globe says over 140,000 smishing SMS blocked in February, March House ratifies Philippine Creatives Industry Development Act Diokno backs tax on digital services LTO-7 recommends cancellation of another major motorcycle dealer’s accreditation Big majority of teachers hired in 2021 by Nueva Ecija are unlicensed – COA E-sabong set to make a comeback Senator calls for probe of P843.9-billion SSS losses
| 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. | SB19’s Ken issues statement on ‘Bulan’ plagiarism allegations [GMA News Online, June 1, 2022] Shortly after the track’s release last Saturday, fans of Chinese singer Lay or Yixing took to social media that they noticed some similarities of “Bulan” to his “Lit.” QC distributes cash aid to over 300 small business owners [Manila Bulletin, June 1, 2022] The Quezon City (QC) government announced on Tuesday, May 31, that a total of 320 small business owners in the city received P5,000 livelihood assistance each under its Small Income Generating Assistance (SIGA) Capital Assistance Program. Incoming DICT chief expects more competition in telco industry [CNN Philippines, June 1, 2022] Such scenario is possible as the government passed amendments in key legislations like the Public Services Act, the Foreign Investments Act, and Retail Liberalization Law, which could all attract more foreign investors into the country. BSP keeps COVID-19 shield for credit card users [Inquirer Mobile, June 1, 2022] Bank regulators have kept the interest cap on credit card transactions at 2 percent per month or 24 percent a year, citing the need to help consumers amid the continuing impact of the COVID-19 pandemic. Confirmed! MUJI to open first café in PH [Rappler, June 1, 2022] Finally! Japanese furniture and lifestyle brand MUJI Philippines will be opening their very first coffee shop in the Philippines – the famous minimalist Muji Coffee café. Outgoing Tourism chief Puyat to join Bangko Sentral as Deputy Governor [ABS-CBN News, June 1, 2022] Puyat was a former lecturer at the UP School of Economics. She also served as Deputy Cabinet Secretary with the Office of the President in 2006 and as Undersecretary in the Department of Agriculture from 2007 to 2018. Hyundai passenger cars now under new distributor [Manila Bulletin, June 1, 2022] Hyundai passenger cars in the Philippines will now be under a new distributor, Hyundai Motor Philippines, Inc. (HMPH). HMPH officially takes the reigns starting July 1, 2022, led by its new president, Lee Dong Wook. SC affirms CTA ruling on tax case of Leyte hotel [Philippine News Agency, June 1, 2022] The SC 3rd Division denied the petition filed by Unimasters Conglomeration, Inc. (UCI) in connection with the taxes arising from its lease of Leyte Park Hotel, Inc. (LPHI) in Tacloban City. Converge doubles base plan from 50Mbps to 100 [Manila Bulletin, June 1, 2022] Good news for Converge users who are working and studying from home. Starting today, Converge has upgraded free upgrades. FiberX Plan 1500, which has 50Mbps, is boosted to 100Mbps. Philippines loses $3.6 billion in potential investments in electronics [The Philippine Star, June 1, 2022] During the signing of a memorandum of understanding between the Philippine Economic Zone Authority (PEZA) and Department of Environment and Natural Resources (DENR) yesterday for cooperation in identifying lands that can be developed as ecozones, SEIPI president Dan Lachica said five companies have opted to bring their $3.6 billion worth of investments to Vietnam, Thailand and China instead of the Philippines. Pagcor to probe physical takeover of Okada Manila [Rappler, June 1, 2022] The Philippines’ Supreme Court (SC) in April ruled that Kazuo Okada could once again lead the Okada Manila integrated casino-resort as head of its operator Tiger Resorts, a position he was ousted from in 2017 on suspicion of misappropriating $3 million. San Miguel starts construction of MRT7 depot in Bulacan [GMA News Online, May 31, 2022] SMC said its infrastructure unit began construction on a 20-hectare property in San Jose del Monte City, which will serve as the main stabling area or train depot. Bankrupt Sri Lanka hikes taxes [ABS-CBN News, May 31, 2022] The value-added tax (VAT) applied on almost all goods and services was raised from 8.0 percent to 12 percent with immediate effect, while corporate taxes were also increased from 24 to 30 percent. Bills raising pension for indigent seniors, granting tax exemption for poll workers up for Duterte's signature [CNN Philippines, May 31, 2022] Bills seeking to double the monthly pension of indigent senior citizens and to grant income tax exemption to poll workers are now awaiting President Rodrigo Duterte's approval. BSP keeps 2 percent ceiling on credit card monthly interest rate [ABS-CBN News, May 31, 2022] The Bangko Sentral ng Pilipinas on Tuesday said it has kept the maximum interest rate and finance charge on credit card balance and transaction fees which it has imposed in September 2020. Filipinos can now visit Seoul visa-free – but there’s a catch [Rappler, May 31, 2022] According to a May 31 announcement by the South Korean Embassy in Manila, nationals of four Asian countries including the Philippines may enter South Korea visa-free, as long as they are fully vaccinated against COVID-19, book a tour program arranged by one of eight designated travel agencies, and are scheduled to fly in and out via Yangyang International Airport on the same flight as their tour group. Globe says over 140,000 smishing SMS blocked in February, March [ABS-CBN News, May 31, 2022] The National Telecommunications Commission over the weekend ordered DITO Telecommunity, Globe Telecom, and Smart to warn the public against job text scams by sending message blasts from May 28 until June 4. House ratifies Philippine Creatives Industry Development Act [Manila Bulletin, May 31, 2022] Under the so-called Creatives Industry Act, the Philippine Creative Industries Development Council–an attachment to the Department of Trade and Industry–will be established to support the Filipino creatives industry to boost employment security, opportunities, and promote the welfare of creative workers. Diokno backs tax on digital services [BusinessWorld, May 30, 2022] INCOMING Finance Secretary Benjamin E. Diokno is eyeing the imposition of taxes on digital transactions and streaming services such as Netflix and Spotify. LTO-7 recommends cancellation of another major motorcycle dealer’s accreditation [Cebu Daily News Digital, May 30, 2022] The Land Transportation Office in Central Visayas (LTO-7) has recommended the cancellation of the Manufacturer, Assembler, Importer, Rebuilder, Dealer, and Other Entities (MAIRDOEs) Accreditation of another major motorcycle dealer in Cebu City. Big majority of teachers hired in 2021 by Nueva Ecija are unlicensed – COA [Rappler, May 30, 2022] The Commission on Audit (COA) red-flagged two incidents in 2021 which involved public elementary and secondary schools in Nueva Ecija. E-sabong set to make a comeback [The Philippine Star, May 30, 2022] It is merely suspended, but when it resumes it will be more regulated and the fights will no longer be round-the-clock, says Ang, the country’s biggest e-sabong operator. How and when this will happen isn’t clear yet, especially with the government in transition. Senator calls for probe of P843.9-billion SSS losses [Philippine Daily Inquirer, May 29, 2022] Sen. Francis Tolentino has called for a congressional inquiry into the reported massive net losses in the finances of the Social Security System (SSS) amounting to P843.9 billion, as shown in its 2021 unaudited financial statements. | DOWNLOAD OUR PAST EDITIONS & FULL TEXT OF REFERENCES https://weeklytaxupdates.getresponsesite.com/ | |
|
|
