BIR CLARIFIES THE ISSUANCE & ENFORCEMENT OF SUBPOENA DUCES TECUM
Other Relevant Tax Updates:
- TAX & BUSINESS-RELATED NEWS [MARCH 31-APRIL 5]
- BIR CLARIFIES THE ISSUANCE & ENFORCEMENT OF SUBPOENA DUCES TECUM
- BIR RULINGS ON BRANCH PROFIT REMITTANCE TAX & TAXABILITY OF PHILIPPINE AIRLINES EQUITY RESTRUCTURING PURSUANT TO A COURT ORDER
1. TAX & BUSINESS-RELATED NEWS [MARCH 31-APRIL 5]
- Tampakan gold mine to operate by 2026
- Makati raises ‘constitutional’ issues in BGC land dispute
- GOCC body tasked to draft Landbank -DBP merger order
- It’s final: Supreme Court says Taguig has jurisdiction over BGC
- BDO partners with 145-year old Japanese regional bank
- ‘We want our money back’: Cebu Pacific promo leaves affected netizens with multiple charges
- Upson debut surprises with 21% price surge
- Indian businesses explore opportunities in Ilocos Norte
- AirAsia eyes expansion to land transport
- Greenhills Mall recognized as one of San Juan City’s top taxpayers
- Ogie Diaz, Rowena Guanzon discuss legal issue involving Ruffa Gutierrez
- PH food exporters bag over $50-M export deals – CITEM
- McDonald’s temporarily shuts US offices, prepares layoff notices -WSJ
- PH longest bridge now powered by P60-M hybrid solar farm
- GCash launches 10 new features
- BSP approves new rules on electronic KYC using digital IDs
- Duty-Free workers eye legal action to save jobs
- Mapua offers unique digital learning setup
- Construction of country’s longest mountain tunnel in full swing
- Metro Pacific now sees full completion of CALAX by 2024
- SMC’s Ramon Ang admits being client of ill-fated ship in Oriental Mindoro
Tampakan gold mine to operate by 2026 [Inquirer Mobile, April 5, 2023]
Mining company Sagittarius Mines Inc. (SMI) aims to get its Tampakan mining project in Mindanao, touted as the largest underdeveloped copper-gold resource in Southeast Asia, up and running by 2026.
Makati raises ‘constitutional’ issues in BGC land dispute [The Philippine Star, April 5, 2023]
The ruling affected Makati’s barangays known as “embos” or “enlisted men’s barrios,” and the transfer of these to Taguig would adversely affect Makati’s voter base and cause instability in its business environment, Camiña said.
GOCC body tasked to draft Landbank -DBP merger order [Inquirer Mobile, April 5, 2023]
The planned merger of Land Bank of the Philippines (Landbank) and Development Bank of the Philippines (DBP), “approved” by President Marcos on March 28, is in progress as the Governance Commission for Government-Owned or -Controlled Corporations (GCG) is preparing a draft Executive Order (EO) that would make it happen.
It’s final: Supreme Court says Taguig has jurisdiction over BGC [ABS-CBN News, April 4, 2023]
Following battles in lower courts which started in 1993, the Supreme Court in December 2021 ruled that the area’s territorial jurisdiction falls under Taguig City. The Makati City government then filed an omnibus motion for reconsideration before the SC.
BDO partners with 145-year old Japanese regional bank [Inquirer Mobile, April 4, 2023]
Sy-led banking giant BDO Unibank Inc. signed a business alliance agreement with 145-year-old Japanese regional bank The Hyakujushi Bank Ltd. (HBL) to support Japanese firms expanding in the Philippines.
‘We want our money back’: Cebu Pacific promo leaves affected netizens with multiple charges [Rappler, April 4, 2023]
Netizens said that upon entering the website, they were asked to input their payment details, only to wind up on an error page. Believing that the transaction was unsuccessful, many reloaded the page and reentered their payment credentials, only to later discover that they had been charged each time.
Upson debut surprises with 21% price surge [Inquirer Mobile, April 4, 2023]
The operator of mall-based shops such as Octagon Computer Superstore, Micro Valley and Gadget King raised P1.65 billion to help expand its network of roughly 200 outlets over the next four years.
Indian businesses explore opportunities in Ilocos Norte [The Manila Times, April 4, 2023]
A group of Indian business delegation from varied sectors such as agriculture, automobiles, chemicals, IT-BPM, ITeSe, irrigation, renewable and others visited Ilocos Norte and participated in the first ever India Business Roadshow in the northern Luzon. The road show was organized by the Embassy of India in Manila in partnership with the Provincial Government of Ilocos Norte (PGIN) and India Business Forum Association Philippines Inc (IBF). It was held at Plaza del Norte in Laoag City on March 27, 2023.
AirAsia eyes expansion to land transport [Inquirer Mobile, April 4, 2023]
Budget carrier AirAsia aims to launch this year a ride-hailing service in the four-wheel segment—which hopes to rival dominant player Grab Philippines—as the airline seeks to expand its transportation product offering in the country.
Greenhills Mall recognized as one of San Juan City’s top taxpayers [The Philippine Star, April 4, 2023]
The recognition was given during the 116th Araw ng San Juan celebration. On behalf of the corporation, Ortigas Land Chief Finance Officer Davee Zuñiga received the award from San Juan councilors Totoy Bernardo, Bea de Guzman-Cabatbat, Paul Artadi and Macky Mathay, and Rep. Bel Zamora.
Ogie Diaz, Rowena Guanzon discuss legal issue involving Ruffa Gutierrez [Manila Bulletin, April 3, 2023]
On his vlog, Ogie shared: “Sa pagkakaalam ko, yes, totoo nga yan – na nanalo yung dalawang kasambahay na pinaalis ni Ruffa Gutierrez sa kanyang Alabang house…”
PH food exporters bag over $50-M export deals – CITEM [Manila Bulletin, April 3, 2023]
The Philippines generated $50.65 million export sales, surpassing its target by over 300 percent, in the world’s largest annual food and beverage expo, Gulfood 2023 at the Dubai World Trade Center in Dubai, United Arab Emirates (UAE).
McDonald’s temporarily shuts US offices, prepares layoff notices -WSJ [Inquirer.Net, April 3, 2023]
Burger chain McDonald’s Corp is temporarily closing its U.S. offices this week as it prepares to inform corporate employees about its layoffs as part of a broader company restructuring, the Wall Street Journal reported on Sunday.
PH longest bridge now powered by P60-M hybrid solar farm [Philippine Daily Inquirer, April 3, 2023]
The Cebu-Cordova Link Expressway (CCLEX), the picturesque third bridge linking mainland Cebu to Mactan Island and now turning to be a new landmark here, is going solar.
GCash launches 10 new features [SunStar Cebu, April 3, 2023]
On Thursday, March 30, 2023, during its FutureCast hybrid event, the fintech firm unveiled 10 new innovations that are designed to create a more inclusive digital landscape.
BSP approves new rules on electronic KYC using digital IDs [ABS-CBN News, April 3, 2023]
The new guidelines recognize the use of e-KYC through the digital ID system and provide the minimum requirements for banks in the conduct of e-KYC, it said.
Duty-Free workers eye legal action to save jobs [The Philippine Star, April 3, 2023]
Last week, about 500 Duty-Free employees received a notice of separation and were given 15 days to reapply for 345 jobs available in the new plantillla. Other employees have yet to receive their notices.
Mapua offers unique digital learning setup [Philippine Daily Inquirer, April 3, 2023]
At Mapua Malayan Digital College (MMDC), the approach is not like traditional online learning where teachers deliver the lectures through real-time virtual classes as they give prompts, problems, and cases instead.
Construction of country’s longest mountain tunnel in full swing [The Manila Times, April 3, 2023]
The Davao City Bypass Construction Project begins at Barangay Sirawan, Toril and will end at Barangay J.P. Laurel in Panabo City.
Metro Pacific now sees full completion of CALAX by 2024 [BusinessWorld, April 2, 2023]
A UNIT of Metro Pacific Tollways Corp. (MPTC) said the target for fully completing the Cavite-Laguna Expressway (CALAX) is now 2024 if right-of-way (RoW) issues are resolved.
SMC’s Ramon Ang admits being client of ill-fated ship in Oriental Mindoro [ABS-CBN News, March 31, 2023]
San Miguel Corporation President and CEO Ramon Ang disclosed Friday that they had been a client of RDC Reield Marine Services (RDC).
2. BIR CLARIFIES THE ISSUANCE & ENFORCEMENT OF SUBPOENA DUCES TECUM
Revenue Memorandum Circular (RMC) No. 33-2023, issued on March 17, 2023, clarifies that the issuance and enforcement of Subpoena Duces Tecum (SDT) shall also apply in the monitoring and verification of taxpayer’s compliance with relevant tax laws, such as but not limited to examination of registered taxpayers’ payment of Annual Registration Fee, issuance of sales invoices or official receipts, keeping books of accounts, timely filing and payment of tax returns, withholding tax on income payments, filing of required information returns, and notification to unregistered taxpayers to register and pay voluntarily any unpaid taxes due on past transactions.
3. BIR RULINGS ON BRANCH PROFIT REMITTANCE TAX & TAXABILITY OF PHILIPPINE AIRLINES EQUITY RESTRUCTURING PURSUANT TO A COURT ORDER
[THE 15% BRANCH PROFIT REMITTANCE TAX (BPRT) IS IMPOSED ON PROFITS REMITTED ABROAD BY A BRANCH TO ITS HEAD OFFICE] [MERE REIMBURSEMENTS OF ACTUAL EXPENSES/COSTS WITHOUT ANY MARK-UP OR PROFIT ELEMENT DO NOT CONSTITUTE INCOME PAYMENTS & THEREFORE, NOT SUBJECT TO PHILIPPINE INCOME TAXES] [FOREIGN EXCHANGE REMITTANCE AS REIMBURSEMENTS FOR ADVANCED OPERATING FUNDS IS NOT SUBJECT TO BPRT]
T Phil. is requesting confirmation that its purchase of foreign exchange for remittance to its head office, T Japan, as reimbursements for advanced operating funds are not subject to Branch Profit Remittance Tax (BPRT) considering that the same are mere liquidation or return of temporary operating funds for the Japanese International Cooperation Agency (JICA) and Official Development Assistance (ODA) Project. In reply, the 1997 Tax Code, as amended, provides that any profit remitted by a branch to its head office is subject to the BPRT at the rate of 15%. However, the amounts to be remitted by T Phil. To T Japan, consisting of the amounts previously advanced by the head office as operating funds to pay for labor, local materials, and other operating costs and expenses needed in the implementation of the project, are not profits but capital contributions of the head office and, therefore, not subject to the BPRT. These are in the nature of a temporary fund of T Japan in order to finance the pending project of T Phil. [BIR RULING NO. 007-2023, FEBRUARY 15, 2023]
CONVERSION OF CLAIMS OF IMPAIRED UNSECURED CREDITORS PURSUANT TO RESTRUCTURING IS TAX EXEMPT
PAL Co. is requesting confirmation that the mandatory exchange of PAL Co. equity into PHI Co. equity which resulted from a financial restructuring under a court-supervised bankruptcy proceeding does not give rise to any taxation event, specifically Capital Gains Tax (CGT) and Donor’s Tax. In reply, Section 19 of the Republic Act (R.A.) No. 10142, otherwise known as the “Financial Rehabilitation and Insolvency Act (FRIA) of 2010” states that taxes and fees due to the national government imposed upon the issuance of the commencement order and until the approval of the rehabilitation plan or dismissal of the Petition, whichever is earlier, shall be considered waived. Here, the BIR ruled that: (1) the conversion of claims of impaired unsecured creditors to PAL equity; and (2) the swapping of PAL shares to PHI shares; even if they are to be effected within one (1) year from the effective date of the Plan, which is after the approval of the Plan by the court, is not subject to Income Tax and/or CGT, considering that (a) these acts are in the nature of capital transactions; (b) being done as a result of the mutual agreement/s of PAL and its creditors, but of judicial action; (c) being made in furtherance of the objectives of the rehabilitation plan; and (d) being implemented in compliance with the Plan approved by the US Court and recognized by Regional Trial Court-Pasay pursuant to R.A. No. 10142. Given that there was no act of liberality or donative intent since the conversion of the impaired unsecured creditors’ debts into PAL shares and its subsequent mandatory exchange to PHI shares were made pursuant to the court-approved Plan, the mandated arrangements are likewise not subject to Donor’s Tax. [BIR RULING NO. 001-2023, JANUARY 6, 2023]