WEEKLY TAX UPDATES [MAY 21-25, 2018]

SECURITIES & EXCHANGE COMMISSION (SEC) LEGAL OPINION FOR THIS WEEK

 

ACTUAL DELEGATION TO THE BOD THROUGH A STOCKHOLDERS’ RESOLUTION IS REQUIRED

In the proposed amendment of the By-Laws of the Union Bank of the Philippines, it includes the delegation to the Board of Directors (BOD) the power to amend or repeal said By-Laws. However, the Banko Sentral ng Pilipinas refused to give due course over the same on the ground that the delegation should be embodied in a Stockholders’ Resolution to be submitted to the Securities and Exchange Commission (SEC) and not in the By-laws. In this regard, the SEC has opined that what is required to be embodied in a Resolution, and not in the By-laws, is the actual delegation by the stockholders to the Board the power to amend or repeal the By-Laws and not the enabling provision that allows the delegation by the stockholders of such power as lifted from Sec. 48 of the Corporation Code. In the case at hand, the Union Bank’s proposed amendment to the By-Laws merely states the power of its stockholders to delegate to the Board the authority to amend or repeal said By-laws and not the actual delegation itself. To operationalize the delegation, owners of at least 2/3 of the outstanding capital stocks shall pass the appropriate resolution in a Stockholders’ Seeting. The resolution may spell out the extent or limits of the delegation, including when it is considered “functus officio”. [SEC-OGC OPINION NO. 18-08, APRIL 20, 2018]

 

BIR ISSUANCES FOR THIS WEEK

The BIR has issued the following for this week:

 

  1. Revenue Memorandum Order (RMO) No. 23-2018, dated May 21, 2018, which prescribes policies, guidelines, and procedures, in the availment of 8% Income Tax Rate option for individuals earning from self-employment and practice of profession

 

  1. RMO No. 22-2018, dated April 10, 2018 with released date on May 17, 2018, which revises the guidelines and procedures in the conduct of tax compliance verification drive specifically removing the requirement for the Tax Mapping Team to issue a “Reminder Letter” to all business establishments being tax mapped.

 

  1. Revenue Memorandum Circular (RMC) No. 34-2018 dated May 17, 2018 circularizes the effectivity of the Philippines-Sri Lanka Double Taxation Agreement giving tax relief to the concerned Sri Lankan and income earners on their income arising in the Philippines beginning January 1, 2019. It likewise provides for the guidelines and procedures for the availment of relief.

 

TAX NEWS

 

Gov’t readies incentives certification system for firms promoting green jobs [Manila Bulletin, May 18, 2018]

The Climate Change Commission is now developing the standards and certification system in line with the incentives for businesses and enterprises which are promoting green jobs.

Source: https://business.mb.com.ph/2018/05/16/govt-readies-incentives-certification-system-for-firms-promoting-green-jobs/

 

TRAIN law exceeds revenue target [Manila Bulletin, May 16, 2018]

The government registered a net revenue gain in the implementation of the Duterte administration’s first tax reform law in the first three months of the year owing to higher taxes remitted by the tobacco industry.

Source: https://business.mb.com.ph/2018/05/16/train-law-exceeds-revenue-target/

 

SSS awaits PRRD’s nod for pension hike [Manila Bulletin, May 16, 2018]

State-run Social Security System (SSS) said yesterday that it is waiting for President Rodrigo R. Duterte’s order to release the additional benefit to pensioners.

Source: https://business.mb.com.ph/2018/05/16/sss-awaits-prrds-nod-for-pension-hike/

 

TRAIN brings tax effort to new record high in Q1 [Manila Bulletin, May 07, 2018]

The government’s efficiency in collecting taxes reached a new record high in the first quarter of the year following the implementation of the Tax Reform for Acceleration and Inclusion (TRAIN) Act, its first tax reform law, in January this year, the Department of Finance (DOF) said.

Source: https://business.mb.com.ph/2018/05/13/train-brings-tax-effort-to-new-record-high-in-q1/

 

Suspend excise tax on fuel – solon [Manila Bulletin, May 19, 2018]

The government was asked on Friday to suspend the implementation of the excise tax on fuel under the Tax Reform for Acceleration and Inclusion (TRAIN) Law amid fresh calls by jeepney operators for a P2 fare increase.

Source: https://news.mb.com.ph/2018/05/18/suspend-excise-tax-on-fuel-solon-2/

 

BIR: Business activities of LGUs subject to taxation [Manila Bulletin, May 18, 2018]

CEBU CITY – Proprietary or business activities of local government units (LGUs) are subject to taxation, the Bureau of Internal Revenue (BIR) said.

Source: https://news.mb.com.ph/2018/05/18/bir-business-activities-of-lgus-subject-to-taxation/

 

New taxes merit review in face of rising prices [Manila Bulletin, May 18, 2018]

Prices have been rising since January this year. The Department of Finance said the inflation rate has now hit a three-year high of 4.5 percent, when the target range of the Bangko Sentral ng Pilipinas was only 2 to 4 percent.

Source: https://news.mb.com.ph/2018/05/18/new-taxes-merit-review-in-face-of-rising-prices/

 

Health group urges hike in tobacco taxes [Manila Bulletin, May 16, 2018]

A Quezon City-based health group said increasing taxes for tobacco is very crucial in achieving universal public health care.

Source: https://news.mb.com.ph/2018/05/16/health-group-urges-hike-in-tobacco-taxes/

 

Tax on teachers’ election duty honoraria up to BIR — Comelec [Manila Bulletin, May 17, 2018]

Commission on Elections (Comelec) spokesperson James Jimenez said the issue on whether or not to tax the honoraria of teachers who will serve in the May 14, Barangay and Sangguniang Kabataan (SK) elections is up to the Bureau of Internal Revenue (BIR).

Source: https://news.mb.com.ph/2018/05/07/tax-on-teachers-election-duty-honoraria-up-to-bir-comelec/

 

Qualified teachers may seek refund of 5% tax withheld by Comelec [Manila Bulletin, May 14, 2018]

Although the honoraria and allowances of teachers, who served in the Electoral Boards, in the Barangay and Sangguniang Kabataan (SK) polls, will still not be exempted from taxes, those qualifed may refund the five percent that will be withheld from them by the Commission on Elections (COMELEC).

Source: https://news.mb.com.ph/2018/05/14/qualified-teachers-may-seek-refund-of-5-tax-withheld-by-comelec/

 

Teachers: Honoraria still subject to tax [Manila Bulletin, May 12, 2018]

Despite the appeal of Education Secretary Leonor Briones along with various groups, the honoraria and allowances of volunteer-teachers who will serve in the upcoming local elections will still be subjected to tax.

Source: https://news.mb.com.ph/2018/05/12/teachers-honoraria-still-subject-to-tax/

 

High inflation only temporary – DOF [Manila Bulletin, May 18, 2018]

The Department of Finance (DOF) said yesterday that the rise in inflation is only “temporary,” and remains manageable on the back of a robust Philippine economy.

Source: https://business.mb.com.ph/2018/05/18/high-inflation-only-temporary-dof/

 

BSP further liberalizes foreign exchange regulations [Manila Bulletin, May 18, 2018]

Bangko Sentral ng Pilipinas (BSP) Deputy Governor Diwa C. Guinigundo, currently Officer-in-Charge, said the central bank has again liberalized foreign exchange (FX) regulations to make it easier to access foreign currencies.

Source: https://business.mb.com.ph/2018/05/18/bsp-further-liberalizes-foreign-exchange-regulations/

 

BIR reports increase in electronic ITR filing [Inquirer, May 18, 2018]

The number of taxpayers who filed their income tax returns through electronic means further increased as the Bureau of Internal Revenue made it a more convenient way to beat this year’s deadline.

Source: http://business.inquirer.net/251025/bir-reports-increase-electronic-itr-filing

 

DOF weighs in on Pacquiao’s excise tax hike bid [Inquirer, May 14, 2018]

The multidivision world boxing champion does not actually need him in his corner but Emmanuel D. Pacquiao, now a senator, has the full support of the Finance Secretary Carlos G. Dominguez III and the proposal to double the excise tax on cigarettes as part of the larger goal to discourage its consumption.

Source: https://businessmirror.com.ph/dof-weighs-in-on-pacquiaos-excise-tax-hike-bid/