BIR files cases vs. 25 personnel for misuse of letters of authority
Other Relevant Tax Updates:
- TAX & BUSINESS-RELATED NEWS [JANUARY 22-27]
- SEC LAUNCHES HARBOR, A WEB-BASED BENEFICIAL OWNERSHIP REGISTRY & UPDATES GIS FORMS
- BIR CIRCULARIZES LETTER OF AUTHORITY (LOA) VERIFIER THROUGH CHATBOT REVIE
- CTA CASES
I. TAX & BUSINESS-RELATED NEWS [JANUARY 28-FEBRUARY 4]
1. Philippines, Japan finalize amendments to double taxation treaty
2. Up to 60 contractors face blacklisting by DPWH
3. ‘Philippines at risk of returning to dirty money list’
4. Senate to end BIR LOA misuse probe if reforms effective, says Lacson
5. Kim Seon Ho’s agency denies tax evasion allegations, clarifies company
6. Jollibee Group opens first multi-brand state-of-the-art commissary in Cebu, gearing for accelerated VisMin and PH growth
7. DOJ says SEC complaint vs Villar Land under review; firm says execs ‘entitled to due process’
Philippines, Japan finalize amendments to double taxation treaty [Philippine Daily Inquirer, February 4, 2026]
First signed on Feb. 13, 1980, the agreement aims to avoid double taxation by defining how each country will levy taxes and apply credits to income taxes already paid by citizens and residents of both countries.
Up to 60 contractors face blacklisting by DPWH [The Philippine Star, February 4, 2026]
The Department of Public Works and Highways (DPWH) is eyeing the blacklisting of up to 60 contractors following massive infrastructure corruption within the agency.
‘Philippines at risk of returning to dirty money list’ [The Philippine Star, February 4, 2026]
The Philippines faces a real risk of being placed back on the Financial Action Task Force (FATF) gray list, although authorities are taking steps to prevent a reversal of the country’s recent gains in anti-money laundering and counter-terrorism financing (AML/CTF) reforms.
Senate to end BIR LOA misuse probe if reforms effective, says Lacson [The Manila Times, February 3, 2026]
Lacson, Senate Blue Ribbon Committee (BRC) chairman, made the remark following the BIR’s move lifting the suspension on the use of LOAs.
Kim Seon Ho’s agency denies tax evasion allegations, clarifies company [GMA News Online, February 3, 2026]
According to Soompi, a news outlet reported on February 1 that Kim Seon Ho is the CEO of a family-run production company while the internal director and auditor are his parents. The report said the actor committed tax evasion through the corporation.
Jollibee Group opens first multi-brand state-of-the-art commissary in Cebu, gearing for accelerated VisMin and PH growth [Cebu Daily News, February 3, 2026]
The Danao facility is the fourth—and largest—Jollibee Group commissary in Cebu and its first multi-brand, state-of-the-art commissary in the Philippines. It comes at a time of accelerating economic momentum in VisMin, driven by a strong tourism rebound, the rise of BPO hubs, expanding agribusiness exports, and growing manufacturing clusters—factors that continue to drive employment, consumer spending, and demand across the region.
DOJ says SEC complaint vs Villar Land under review; firm says execs ‘entitled to due process’ [ABS-CBN News, February 2, 2026]
“Remember that when cases are filed here, it is not immediately for preliminary investigation,” Prosecutor General Richard Anthony Fadullon said.
II. SEC LAUNCHES HARBOR, A WEB-BASED BENEFICIAL OWNERSHIP REGISTRY & UPDATES GIS FORMS
In a Press Release dated January 22, 2026, the Commission has announced the launch of Hierarchical and Applicable Relations and Beneficial Ownership Registry (HARBOR), a web-based registry for beneficial ownership (BO) disclosures and updated General Information Sheet (GIS) in relation to SEC Memorandum Circular No. 15, Series of 2025. As announced, HARBOR will be the official platform for BO filings starting January 30, 2026 and is accessible through https://harbor.sec.gov.ph/ or via the SEC’s Electronic Filing and Submission Tool (eFAST) system. HARBOR is integrated with eFAST and is designed to enhance data security, reduce manual processing, and improve the quality and timeliness of BO information.
The SEC also released the 2026 General Information Sheet (GIS), which removes the BO disclosure page in line with the shift to HARBOR. Companies will no longer need to re-submit BO declarations annually unless there are changes; instead, they must revalidate existing BO information. The updated GIS forms are available at bit.ly/2026GISForms.
To access HARBOR, users must have an active eSECURE account and must be active, authorized filers within eFAST. These reforms support the SEC’s ongoing efforts to strengthen transparency, enhance BO data management, and sustain the Philippines’ progress in keeping the country off the FATF grey list, following its successful exit in February 2025.
III. BIR CIRCULARIZES LETTER OF AUTHORITY (LOA) VERIFIER THROUGH CHATBOT REVIE
Revenue Memorandum Circular (RMC) No. 5-2026, issued on January 23, 2026, introduces a new feature of the BIR Chatbot REVIE known as the LOA Verifier. This feature allows taxpayers to validate the authenticity of issued Letters of Authority (LOAs) by entering the taxpayer’s name, Taxpayer Identification Number (TIN), and LOA case number. The circular also outlines the purpose and procedures for LOA validation, including the circumstances under which the Chatbot REVIE will generate an “LOA NOT FOUND” response.
IV. CTA CASES
BOI CERTIFICATIONS DO NOT CONCLUSIVELY SHOW THAT THE SUBJECT SALES ARE INDEED EXPORT SALES SUBJECT TO 0% VAT
Petitioner Phil. Best Canning Corporation filed a Petition for Review seeking a refund of alleged excess and unutilized input Value-Added Tax (VAT) arising from its domestic purchases attributable to zero-rated transactions and purchases of capital goods for the taxable year 2018. Petitioner argued that it fully complied with the invoicing requirements under Section 113 of the Tax Code in issuing its invoices and official receipts, and that deducting the 12% output VAT against its unutilized input VAT is improper. On the other hand, the Respondent Commissioner of Internal Revenue (CIR) countered that the Petition should be dismissed for the Petitioner’s failure to substantiate its administrative claim for a refund and to sufficiently prove its entitlement to a VAT refund. In ruling, although the Petitioner timely filed both its administrative and judicial claims for refund, the case was litigated de novo, requiring full proof of all requisites for a VAT refund. While the Petitioner proved that it is a VAT-registered taxpayer, it failed to prove that the input VAT claimed arose from zero-rated export sales under Section 106(A)(2)(a)(1) of the Tax Code. The Petitioner failed to present proof, such as contracts or delivery receipts showing actual export sales paid for in foreign currency in accordance with the Bangko Sentral ng Pilipinas (BSP) rules. The Board of Investments (BOI) certifications submitted merely established the Petitioner’s status as an exporter, not that the specific sales involved were zero-rated. Having failed to establish that the sales were zero-rated, the Petitioner’s claim necessarily failed, rendering discussion of the other requisites unnecessary. Thus, the Petition was DENIED. [PHIL. BEST CANNING CORPORATION VS. COMMISSIONER OF INTERNAL REVENUE, CTA CASE NO. 10505, JANUARY 21, 2026]
[AN ASSESSMENT THAT INTRODUCES DEFICIENCY ITEMS NOT PREVIOUSLY RAISED IN THE NOTICE FOR INFORMAL CONFERENCE (NIC) & PRELIMINARY ASSESSMENT NOTICE (PAN) VIOLATES DUE PROCESS & IS VOID] [THE DATE OF FILING OF AN ADMINISTRATIVE PROTEST SENT THROUGH REGISTERED MAIL IS THE DATE OF MAILING, NOT THE DATE OF RECEIPT BY THE BIR] [TAXPAYER SHOULD BE AFFORDED THE OPPORTUNITY TO PRESENT HIS SIDE, DURING VARIOUS STAGES OF THE ASSESSMENT PROCESS]
Petitioner A & A Securities, Inc. filed a Petition for Review seeking to overturn and set aside the Final Decision on Disputed Assessment (FDDA) issued by Respondent Commissioner of Internal Revenue (CIR), which assessed Petitioner for deficiency Income Tax for taxable year (TY) 2017. Petitioner argued that the assessment violated due process, as the alleged unreported income did not appear in the Notice for Informal Conference (NIC) and Preliminary Assessment Notice (PAN). Also, the income tax liability reflected in the PAN had already been paid and acknowledged by the Bureau of Internal Revenue (BIR), thereby extinguishing the obligation. Further, the alleged discrepancy represented income of its agent, not its own, and the corresponding taxes had already been withheld. On the other hand, the Respondent asserted that Petitioner’s administrative protest was filed out of time, as it was received by the BIR only on January 6, 2021, allegedly depriving the Court of jurisdiction. Also, under Revenue Memorandum Circular (RMC) No. 11-2014, the issuance of a new deficiency tax assessment in the Formal Letter of Demand/Final Assessment Notice (FLD/FAN) was valid and justified by discrepancies between the Petitioner’s VAT and Income Tax Returns (ITR) indicating undeclared income. In ruling, the Court held that the Petitioner was not informed of Regional Director (RD) Rosario’s 2017 Income Tax assessment on unreported income during an informal conference and pre-assessment stages of the assessment process. Said assessment only made its debut in RD Rosario’s FLD/FAN. Since the BIR’s NIC and PAN failed to inform Petitioner that it has unpaid Income Tax on unreported income resulting from the comparison of its VAT Returns and Annual ITR, the Petitioner was deprived of opportunity to present its side during the informal conference and pre-assessment stages, in violation of the due process requirements under the applicable revenue regulations. Consequently, the BIR defeated the very objective of the NIC and PAN mechanisms, which are intended to allow the early resolution of issues with the taxpayer without going through a formal assessment. Thus, the Petition was GRANTED, and the FDDA was OVERTURNED, resulting in the CANCELLATION of the assessment. [A & A SECURITIES, INC. VS. COMMISSIONER OF INTERNAL REVENUE, CTA CASE NO. 10866, JANUARY 20, 2026]
[YEARBOOKS ARE QUALIFIED AS “BOOKS” UNDER SECTION 109 (Y) OF THE TAX CODE, THEREFORE VAT-EXEMPT] [RETROACTIVE APPLICATION OF BIR RULINGS IS PROHIBITED WHEN PREJUDICIAL TO THE TAXPAYER]
Petitioner Midtown Printing Co., Inc., filed a Petition for Review with a Motion for the Issuance of a Status Quo Ante Order seeking to reverse and set aside the Final Decision on Disputed Assessment (FDDA) issued by the Respondent Commissioner of Internal Revenue (CIR), which held Petitioner liable for deficiency Income Tax and Value-Added Tax (VAT) covering Taxable Year (TY) 2013. Petitioner argued that the printing of yearbooks is a VAT-exempt transaction, and that it relied in good faith on prior BIR rulings treating yearbooks as exempt. It claimed that the retroactive application of BIR Ruling No. 421-2013 is unfair, considering that it was issued only after the close of taxable year 2013, thereby depriving the taxpayer of the opportunity to pass on the VAT burden to its customers. In addition, the application of such a ruling violates the right to equal protection, as other printers and publishers continue to enjoy the VAT exemption. On the other hand, the Respondent countered that tax exemptions are strictly construed and the burden of proving entitlement rests on the taxpayer. There is no law expressly granting tax exemption to the printing of yearbooks. Likewise, yearbooks do not qualify as “books” since they are customized for specific clients, irregularly issued, and have no fixed prices. Finally, the Petitioner is liable for the deficiency Income Tax and VAT regardless of such ruling. In ruling, the Court held that the term “books” should be given its plain meaning, which includes yearbooks, and that BIR Ruling No. 421-2013 cannot be applied retroactively as it would prejudice a taxpayer who relied in good faith on previous rulings. The Court further found that the selective application of the ruling violated equal protection, and that denying the exemption would unduly burden students, which is contrary to the State policy on education. Thus, the Petition was GRANTED, and the assessment was CANCELLED. [MIDTOWN PRINTING CO., INC. VS. COMMISSIONER ON INTERNAL REVENUE, CTA CASE NO. 10570, JANUARY 16, 2026]
[LOCAL TREASURERS MUST COMPUTE TRANSFER TAXES STRICTLY ON THE FAIR MARKET VALUE OF THE ACTUAL PROPERTY INTERESTS TRANSFERRED; THUS, TAXPAYER MAY SEEK REFUND OF OVERPAID LOCAL TRANSFER TAXES, BUT DAMAGES REQUIRE PROOF OF BAD FAITH] [REPUDIATION OF INHERITANCE IS NOT TAXABLE UNDER THE LOCAL SPHERE]
Petitioners Lorenzo Eng Chong J. Ong and Wilson S. Ong filed a Petition for Review seeking the reversal of the Decision rendered by the Regional Trial Court (RTC) of Pasay City in relation to the imposition of transfer tax by the Respondent Pasay City Treasurer Hon. Emelito Tecson. Petitioners argued that transfer tax should be based only on actual portions transferred, not full Fair Market Value (FMV) of entire property. Likewise, repudiation/renunciation of inheritance is not a taxable transfer. If taxable, only aliquot shares should be assessed. Furthermore, the Respondent’s refusal to resolve the Petitioner’s protest violated due process which warranted damages. On the other hand, Respondent countered that since each property had only one tax declaration, it correctly used the entire FMV as the tax base and tax declarations enjoy a presumption of regularity. Likewise, Section 135 of the Local Government Code (LGC) and Pasay City Revenue Code allow the use of the entire FMV when computing transfer taxes. Lastly, there is no bad faith or arbitrariness which attended the assessment. In ruling, the Court held that RTC erred in upholding computation based on full FMV. Transfer tax should apply only to actual portions transferred. Repudiation/renunciation of inheritance does not constitute taxable transfer. Hence, no transfer tax should be imposed thereon. Petitioners are entitled to a refund of ₱2,614,342.36, representing the overpaid transfer taxes. However, Petitioners are not entitled to damages and Attorney’s fees since there is no showing of bad faith or malice by Respondents. Thus, the Petition is PARTIALLY GRANTED. [LORENZO ENG CHONG J. ONG & WILSON S. ONG VS PASAY CITY & CITY TREASURER, CTA AC NO. 09, JANUARY 12, 2026]
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