HUNDREDS OF PRIVATE HOSPITALS IN PH MAY GO BANKRUPT DUE TO CORONAVIRUS PANDEMIC + SALCEDA WANTS ADDITIONAL TAX ON DIGITAL SERVICES LIKE NETFLIX LAZADA FB ADS FOLLOWING INDONESIA MODEL]
Other Relevant Tax Updates:
- Securities and Exchange Commission (SEC) extends deadline for submission of Audited Financial Statements (AFS) for those with fiscal year ending January to April 2020
- SEC procedures in the filing of AFS and general information sheet (GIS) after Enhanced Community Quarantine (ECQ)
- Bureau of Internal Revenue (BIR) amends certain provisions relative to extension of deadline on the submission and filing of returns
- BIR clarifies the need for tax clearance before Philippine Offshore Gaming Operator (POGO) can resume operations
- Philippine Economic Zone Authority (PEZA) extends validity of Letter of Authority (LOA) of PEZA-accredited service enterprises
- Tax and business-related news [May 16-21]
I. SEC EXTENDS DEADLINE FOR SUBMISSION OF AFS FOR THOSE WITH FISCAL YEAR ENDING JANUARY TO APRIL 2020
SEC Memorandum Circular (MC) No. 17, Series of 2020, issued on May 7, 2020 extends the deadline for the submission of AFS, Annual, and Quarterly Reports of companies, publicly-listed or not, with fiscal year ended January 31 to March 31, 2020 for a period of 60 calendar days from the regular filing deadlines. For those companies with fiscal year ended April 30, 2020, the extended deadline is for a period of 45 calendar days from the regular filing deadline.
II. SEC PROCEDURES IN THE FILING OF AFS AND GIS AFTER ECQ
SEC MC No. 18, Series of 2020, issued on May 11, 2020, provides for SEC procedures in the filing of AFS and GIS after ECQ.
Highlights of the circular include:
- New procedures are introduced to protect SEC personnel from COVID-19;
- All corporations, including Branch Offices, Representative Offices, Regional Headquarters and Regional Operating Headquarters of foreign corporations, shall file their AFS and GIS thru the SEC Express Nationwide Submission (SENS) to any courier of their choice and/or postal office;
- Date of mailing, as shown by the registry receipt of the courier, shall be considered as the reckoning date of submission. For reports filed through registered mail in the postal office, the reckoning date of receipt shall be the date of receipt by postal office. For reports filed through email during ECQ, the reckoning date of receipt shall be the date stated in the Acknowledgement Confirmation stated in the email;
- All corporations with principal office under the jurisdiction of any of SEC Extension Offices (EO), shall file their reports to the nearest EO;
- All SEC satellite offices shall be temporarily closed for receiving of reports. All filings shall be delivered to the SEC Head Office in PICC;
- AFS, other than the consolidated FS, shall have the stamp “received” by BIR;
- Date of filing shall be dependent on the last numerical digit of SEC registration or license number in accordance with the specific schedules provided in the circular.
III. BIR AMENDS CERTAIN PROVISIONS RELATIVE TO EXTENSION OF DEADLINE ON THE SUBMISSION AND FILING OF RETURNS
Revenue Regulations (RR) No. 12-2020, issued on May 21, 2020, amends RR 10-2020, as amended by RR 11-2020, relative to the extension of deadline on the submission and filing of returns and documents pursuant to the ”Bayanihan to Heal as One Act.” It may be recalled that under RR 11-2020, as further clarified in RMC Nos. 42, 43, 44-2020, the regulations further extend the deadline for the filing and payment of tax returns and other BIR submissions in relation to the May 15 extension of the ECQ period. A 30-day extension for those returns and submissions falling due in the month of May 2020 was provided and the relaxed rules in the acceptance of tax payments during the ECQ period. RR 12-2020 now provides that the extension of due dates shall be made applicable throughout the Philippines. If the new extended due dates fall on a holiday or non-working day, then the submission shall be made on the next working day. Likewise, the defined extended due dates under Section 2 of RR 11-2020 shall remain in effect regardless of any extension or modification of quarantine.
IV. BIR CLARIFIES THE NEED FOR TAX CLEARANCE BEFORE POGO CAN RESUME OPERATIONS
Revenue Memorandum Circular (RMC) No. 46-2020, issued on May 7, 2020, circularizes the guidelines and requirements for POGO Licensees and Service Providers to apply for a BIR Clearance in connection with the resumption of operations. An application letter for the issuance of a BIR Clearance must be submitted to the BIR POGO Task Force via e-mail to firstname.lastname@example.org. The Letter should specify the company name, Taxpayer Identification Number (TIN), business address, authorized representative and their contact details, plus the monthly regulatory fees paid to the Philippine Amusement and Gaming Corporation (PAGCOR) in prior years. Failure to comply with the conditions as well as submission of falsified or fraudulent documents shall result in the denial of the issuance of a BIR Clearance for resumption of operations.
V. PEZA EXTENDS VALIDITY OF LOA OF PEZA-ACCREDITED SERVICE ENTERPRISES
PEZA Memorandum Circular No. 2020-0017, dated March 25, 2020 extends the validity of LOA of PEZA-accredited service enterprises such as customs brokers and freight forwarders, truckers, haulers, and security agencies until June 30, 2020 provided that their licenses are valid within the period of ECQ.
VI. TAX AND BUSINESS-RELATED NEWS [MAY 16-21]
- Hundreds of private hospitals in PH may go bankrupt due to coronavirus pandemic
- Meralco says sorry, to refund P47 online payment fee
- Dominguez: Proposed stimulus package ‘PH-Progreso’ is sufficient
- Hotel rooms to be limited to double occupancy in Philippines’ new normal: DOT
- ABS-CBN says employees’ retrenchment looms in August if shutdown continues
- GSIS extends ‘proof of life’ deadline for 2nd time until June 30
- PAL completes ‘gold standard’ in flight safety audit
- DOF warns about cryptocurrency scam
- DOF looks at digital services tax to capture unpaid VAT
- Salceda wants additional tax on digital services like Netflix, Lazada, FB ads
- Netflix, Facebook and Google to get taxed under Salceda bill
- Finance dept pushes ‘recalibrated’ corporate tax reform package as ‘stimulus’ for economy
- Philippine Airlines to require COVID-19 test, quarantine for international arrivals
- Pagcor says its intel helping police crackdown on ‘NOGOs’
- Higher Netflix bill? Indonesia to charge VAT on imported digital goods, services starting July
- Awful data shows US economy is in deep trouble
Hundreds of private hospitals in PH may go bankrupt due to coronavirus pandemic [ABS-CBN News, May 21, 2020]
A group of private hospitals in the Philippines warned nearly half of its 900 members may go bankrupt in the coming month.
Meralco says sorry, to refund P47 online payment fee [ABS-CBN News, May 21, 2020]
Manila Electric Co said Thursday it would refund customers for an online payment fee and apologized for failing to shoulder it during the COVID-19 lockdown.
Dominguez: Proposed stimulus package ‘PH-Progreso’ is sufficient [Philippine Daily Inquirer, May 20, 2020]
The proposed amounts reaching a maximum of P160 billion being pitched by the Duterte administration’s economic team as stimulus fund for COVID-19 response are sufficient even for those in rural areas, according to Finance Secretary Carlos G. Dominguez.
Hotel rooms to be limited to double occupancy in Philippines’ new normal: DOT [ABS-CBN News, May 20, 2020]
Hotels in the Philippines can only accommodate up to 2 persons per room once the government allows the hospitality industry to resume operations under a new normal due to the coronavirus crisis, Tourism officials said Wednesday.
ABS-CBN says employees’ retrenchment looms in August if shutdown continues [ABS-CBN News, May 20, 2020]
The Senate formally tackled the franchise bill of media giant ABS-CBN, seeking guidance from constitutional experts. This report tells us, the network is losing tens of millions of pesos each day it remains off the air.
GSIS extends ‘proof of life’ deadline for 2nd time until June 30 [Philippine Daily Inquirer, May 19, 2020]
The Government Service Insurance System (GSIS) has further extended to June 30 the last day for pensioners born in the months of March to May to present “proof of life” for recognition as active members.
PAL completes ‘gold standard’ in flight safety audit [Philippine Daily Inquirer, May 19, 2020]
The Philippine Airlines group announced the completion of a crucial safety audit by the International Air Transport Association (IATA).
DOF warns about cryptocurrency scam [Philippine Daily Inquirer, May 19, 2020]
Contrary to “fake news” spreading around which even name-dropped President Rodrigo Duterte, the Philippine government is not enjoining all Filipino citizens to invest in cryptocurrencies, the Department of Finance (DOF) warned on Tuesday.
DOF looks at digital services tax to capture unpaid VAT [Philippine Daily Inquirer, May 19, 2020]
Proposals to tax digital services to plug leaks in unpaid 12 percent VAT by some online businesses has caught the attention of the Department of Finance (DOF) which is now looking at the suggestions.
Salceda wants additional tax on digital services like Netflix, Lazada, FB ads [Philippine Daily Inquirer, May 19, 2020]
House ways and means committee chair and Albay Rep. Joey Salceda is pushing for taxation on digital services—specifically, subscriptions to video and music streaming apps, ads on social media sites, and making online sales platforms as withholding tax agents—to offset an estimated P120 billion in foregone revenues once the government cuts corporate income taxes to 25 percent to soothe the pain inflicted by COVID-19 on businesses.
Netflix, Facebook and Google to get taxed under Salceda bill [ABS-CBN News, May 19, 2020]
Netflix, Spotify, Facebook, Google and other global internet companies that do business in the Philippines will be subject to the value added tax and other duties under a bill filed by Albay Rep. Joey Salceda.
Finance dept pushes ‘recalibrated’ corporate tax reform package as ‘stimulus’ for economy [ABS-CBN News, May 19, 2020]
The Department of Finance said on Tuesday that it has “recalibrated” the tax package meant to reform corporate income taxes and financial incentives so that it can better help small businesses and stimulate the economy.
Philippine Airlines to require COVID-19 test, quarantine for international arrivals [ABS-CBN News, May 19, 2020]
International visitors to the Philippines will need to undergo a COVID-19 test and subsequent quarantine, Philippine Airlines said Monday, as it looked to resume a limited number of flights on June 1.
Pagcor says its intel helping police crackdown on ‘NOGOs’ [Philippine Daily Inquirer, May 18, 2020]
The intensified drive of the Philippine Amusement and Gaming Corp. against illegal online gambling firms helped law enforcers in shutting down a fly-by-night firm and led to the arrest of their Chinese employees, the regulator said.
Higher Netflix bill? Indonesia to charge VAT on imported digital goods, services starting July [Philippine Daily Inquirer, May 17, 2020]
Indonesia’s Finance Ministry will start charging 10 percent value-added tax (VAT) on imported digital goods and services, which includes video and music streaming subscriptions, starting from July 1 in an attempt to boost state revenue amid the COVID-19 outbreak.
Awful data shows US economy is in deep trouble [ABS-CBN News, May 16, 2020]
Newly released economic data shows the US economy is in a terrible state and may not rebound quickly even when the devastating lockdowns imposed to stop the coronavirus pandemic are lifted.
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