BIR sues Makati company for P200-M taxes

admin   •   February 16, 2018   •   6517

MANILA, Philippines — The Bureau of Internal Revenue (BIR) has filed tax evasion complaints against a construction company based in Makati City.

According to the BIR, the unpaid taxes of SKI Construction Group, Incorporated has reached over P200 million, covering taxable years 2005 and 2010.

The BIR also filed tax evasion complaints against Y.N. General Services Incorporated for P15 million in unpaid taxes.

The two companies allegedly refused to settle their deficiency taxes despite repeated notices.

“The respondents’ obstinate failure and continued refusal to pay their long overdue deficiency taxes, despite repeated demands, constitute willful failure to pay the taxes due to the government,” said BIR Asst. Commissioner Atty. James Roldan. — UNTV News & Rescue

Makati subway project to get tax incentives – DOF

Robie de Guzman   •   November 8, 2021

MANILA, Philippines — The rail operations of the Makati City Subway project will be granted a four-year income tax holiday followed by five years of enhanced deductions and duty exemption on importation for the construction, operation, management, and maintenance of the project, the Department of Finance (DOF) said Monday.

In a statement, the DOF said the Fiscal Incentives Review Board (FIRB) has approved the grant of tax incentives for the P81-billion Makati City subway project, which is expected to begin commercial operations in January 2026.

 The DOF said the board approved the tax incentive grant last month.

“In deciding to approve the project, the FIRB took into consideration the projected increase in economic productivity of P24.4 billion per year once the subway system becomes operational in 2026,” the DOF said.

“This will be monitored, along with the other projected benefits, in accordance with the principle of granting incentives based on merit or performance embodied in the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Law,” it added.

Finance chief Carlos Dominguez, however, clarified that this package of incentives is confined only to the activity applied for, which is the rail operation.

“The incentives approved will not apply to the other business activities that would be generated from the subway operations, such as the lease of retail areas and advertising, which should be subject to the regular corporate income tax rate and other applicable taxes,” the DOF said.

The subway project is seen to help ease traffic congestion by providing an alternative transport service to up to 700,000 commuters, and reducing the volume of vehicles plying the city streets.

Throughout the deliberations for the project, Dominguez also said that the Makati City government and the Department of Transportation should work out the details of how to connect the proposed subway to the Metro Manila Subway project of the national government, the DOF said.

BIR to probe tax compliance of initial 250 social media influencers

Robie de Guzman   •   September 16, 2021

MANILA, Philippines – The Bureau of Internal Revenue (BIR) is set to launch an investigation into the initial list of 250 social media influencers to check on their tax compliance.

In a report to Department of Finance (DOF) Secretary Carlos Dominguez III, the BIR said that Letters of Authority (LOAs) for the conduct of investigation have been issued to certain social media influencers found to be “top earners.”

The BIR said that social media personalities who earn money from their posts on digital media are classified as self-employed individuals or persons engaged in trade or business as sole proprietors.

Their earnings are generally considered as business income as defined under BIR’s Revenue Memorandum Circular (RMC) No. 97-2021 issued last Aug. 16, the bureau added.

“We encourage them to register, and then we have the profiling of over 250 personalities. We will do the investigation so that they would pay the necessary corresponding tax on their earnings,” BIR Deputy Commissioner Arnel Guballa said in his report to Dominguez.

Under RMC 97-2021 issued in August, social media influencers should pay income tax and percentage tax or, if applicable, the value-added tax (VAT), as mandated under the National Internal Revenue Code (NIRC) and other existing laws.

Based on the Circular, social media influencers are defined as those who derive their income from the following sources:

  1. a) You Tube Partner Program;
  2. b) sponsored social and blog posts;
  3. c) display advertising;
  4. d) becoming a brand representative/ambassador;
  5. e) affiliate marketing;
  6. f) co-creating product lines;
  7. g) promoting own products;
  8. h) photo and video sales;
  9. i) digital courses, subscriptions, e-books;
    j) podcasts and webinars

The Circular states, among others, that social media influencers who receive free goods in exchange for promotions must declare as income the fair market value of these products.

Income treated as royalties from another country, including payments under the YouTube Partner Program, shall likewise be included in the computation of the gross income of the socmed influencer and shall be subject to tax.

“It must be emphasized that the BIR also has the power to obtain information from foreign tax authorities pursuant to the Exchange of Information (EOI) provision of the relevant tax treaties. The BIR has the means to verify their income as it is clothed with a special power to obtain information from its treaty partners. The BIR may safely rely on the data provided by its treaty partners to establish the influencer’s tax liability,” RMC 97-2021 stated.

“The social media influencers are, therefore, advised to voluntary and truthfully declare their income and pay their corresponding taxes without waiting for a formal investigation to be conducted by the BIR to avoid being liable for tax evasion and for the civil penalty of fifty percent (50 percent) of the tax or of the deficiency tax,” it added.

In order to avoid the risks of double taxation, the BIR advised social media influencers receiving income from a non-resident person residing in a country, with which the Philippines has a tax treaty, to inform the latter that they are residents of the Philippines, and are, therefore, entitled to claim treaty benefits provided under the relevant tax agreement.

The Circular said social media influencers who “willfully attempt to evade the payment of tax or willfully fail to make a tax return, to supply accurate and correct information or to pay tax” shall, in addition to the payment of taxes and corresponding penalties, be held criminally liable under the Tax Code.

Social media influencers na hindi nagbabayad ng buwis, tinutukoy na — BIR

Robie de Guzman   •   August 24, 2021

MANILA, Philippines — Sinimulan na ng Bureau of Internal Revenue (BIR) ang proseso sa pagtukoy sa social media influencers na maaaring kasuhan dahil sa hindi pagbabayad ng buwis.

Ayon kay Atty. Marisa Cabreros, ang deputy commissioner for legal group ng BIR, bahagi ito ng mandato ng ahensiya na habulin at papanagutin ang mga tax evader.

Ani Cabreros, ang sinumang kumikita sa pamamagitan ng alinmang social media platforms ay obligadong magpa-rehistro at ideklara ang kanilang kinikita sa BIR.

Sakop nito ang mga gumagawa ng online content o nag-eendorso ng mga produkto gaya halimbawa ng mga vlogger o Youtubers.

“Basta lahat po ng ating mga nasa online ang means of kita, kumikita sila binabayaran sila sa kahit anong klase ng serbisyo na ginagawa online… Lahat po ng taxpayers, indibidwal at korporasyon na tumatanggap ng income, in-cash or in-kind na ginagamit ang media site or any other platform at any activity perform on those sites and platform basta kumikita sila,” ani Cabreros.

“Because of it sila po ang tinutukoy natin na kailangang magrehistro, yun nga lang po ang mga famous as example are our Youtubers, yung nag-live streaming sa Facebook, Instagram, Twitter, Tiktok, Reddit, Snapshot and all other platforms po,” dagdag pa niya.

Pero paglilinaw ng BIR, hindi lahat ng social media influencers ay pagbabayarin ng buwis.

Aniya, ang small time social media influencers na may annual net income ng hindi hihigit sa P250,000 ay exempted sa pagbabayad ng tax alinsunod sa Tax Reform for Acceleration and Inclusion Law.

Kaya wala umano silang dapat na ipag-alala at sa halip ay kinakailangan lamang na magparehistro at ideklara ang kanilang negosyo.

“Kaya yung sinasabi ng iba na maliit lang kami wala naman kaming gaanong kinikita pa, wala po silang dapat ikatakot,” ani Cabreros.

Babala ng BIR, maaaring maharap sa kaso ang sinumang social media influencer na hindi magdedeklara ng kanilang kita o kaya ay hindi nagbabayad ng tamang buwis.

Maaari din silang kasuhan sa hindi pagpapa-rehistro, hindi mag-iisyu ng resibo at tax fraud.

Posibleng makulong ng hindi bababa sa anim na taon at pagmultahin ng hanggang P10 miylyon ang sinomang hindi magbabayad ng tamang buwis. RRD (mula sa ulat ni Correspondent Marvin Calas)

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