News

I would have a very short but meaningful message for all of us today.  Today is an important day for the Firm as we celebrate our 57th anniversary and from hereon, each year of our anniversary celebration becomes important as we prepare ourselves for another milestone in 2019 when we celebrate our Diamond Jubilee celebration (60th anniversary).  Let us look forward to this future milestone in the Firm’s history and let us make it more meaningful by working together and putting our focus in shaping up a better and bigger DMD.  We should aspire to in further improving our revenues and profitability by introducing meaningful changes in our strategies and business processes and by further enhancing the technologies we use  as a tool to achieve this objective.

My Dear Colleagues in DMD & Co. CPAs, Clients and Friends. I greet all of you with a Happy 57th Anniversary! We founded the Firm in 1959 and was originally professionally known as L. C. Diaz & Company CPAs at that time there were three leading CPA firms in the country. In spite their advantage of an early start, yet a third firm known as the Philippine Investment Management Consultants (PHINMA) has been organized in 1956, wherein I was one of the original consultants.

Updates

A.     COURT OF TAX APPEALS (CTA) DIGEST FOR THIS WEEK

 

TO BE LIABLE TO 18% AMUSEMENT PERCENTAGE TAX, DANCING MUST BE THE MAIN BUSINESS OF A CABARET, NIGHT OR DAY CLUB

The Petitioner Hard Rock Café, Inc. filed a Petition for Review praying for the cancellation of the Percentage Tax Assessment issued by the Respondent Commissioner of Internal Revenue on the ground that the Petitioner falls under the category of cabarets, night or day clubs” and therefore liable to Amusement Tax of 18%, a kind of Percentage Tax under the Tax Code. Likewise, the Respondent premised its assessment on the provisions of Revenue Memorandum Circular No. 18-2010 which clarifies the coverage and taxability of amusement places. Based on the investigation conducted, the Respondent found that the Petitioners business premise is considered an amusement place mainly because it serves liquor and food to its customers, with stage performances by musicians and dancers. In one case, the Supreme Court defined cabarets as place of amusement where customers go because of their desire to dance and where the bailarinas are the main attraction. On the other hand, it defines Night Clubs as a place or establishment selling to the public food or drinks, where the customers are allowed to dance. In final conclusion, the CTA said that it appears from the definitions that the primary and common activity to cabarets, night and day clubs is dancing. In the said places, the customers are allowed to dance either with their own partners or with professional hostesses provided by the cabarets or clubs. Thus, to be deemed a cabaret, or night and day club, it must be established that its operations involve dancing as the main business and customers patronize the place in order to dance either with their own partners or with professional hostesses engaged by Petitioner for that purpose. The evidence however shows that the business activities of the Petitioner do not fall within the scope or coverage of the cabarets and/or day clubs, since there is no indication that its customers frequent its establishment to dance, either with their own partners, or with professional hostesses provided by the Petitioner. More importantly, the evidence presented show that the actual business activities of the Petitioner are those of restaurant, with the entertainment usually by the performances of live bands, which is merely incidental to its main business to encourage or attract customers with the end view of promoting sales of foods and drinks served in the restaurant. The Petition for Review is GRANTED and the Percentage Tax Assessment is CANCELLED. [HARD ROCK CAFÉ, INC. VS COMMISSIONER OF INTERNAL REVENUE, CTA CASE NO. 9279, JULY 12, 2018]