Shifting the balance: Countries look to indirect taxes in a bid to balance the books post recession

Client Advisory Letter, March-April 2010 issue

In this issue: 

Shifting the balance: Countries look to indirect taxes in a bid to balance the books post recession

Bureau of Internal Revenue

Revenue Memorandum Circular (RMC)

  • RMC 17-2011, 17 March 2011

BIR Ruling

  • Interest on intercompany loan is not subject to 2% withholding tax (BIR Ruling No. 110-2011, 11 April 2011)
  • Period to file short period return may be extended by the BIR under meritorious circumstances (BIR Ruling No. 097-2011, 6 April 2011)
  • General renunciation made by an heir of his inheritance is not subject to donor’s tax (BIR Ruling No. 89-2011, 21 March 2011)
  • Exchange of real property without monetary consideration may not be subject to capital gains tax (BIR Ruling No. 95-2011, 5 April 2011)

Other issuances

Court decisions

Supreme Court (SC)
  • DST implication upon renewal of life insurance policy (GR No. 169103, dated 16 March 2011)
Court of Tax Appeals (CTA)
  • Director’s bonus is subject to withholding tax on compensation (CTA EB Case No. 563 (CTA Case No. 6200) dated 1 March 2011)
  • Requisites to exempt transportation expense, subsistence lodging and representation expense from withholding tax on compensation (CTA EB Case No. 563 (CTA Case No. 6200) dated 1 March 2011)
  • The court is not bound by the findings of the ICPA (CTA EB Case No. 563 (CTA Case No. 6200) dated 1 March 2011)
  • Delinquency interest on assessment shall be charged from the time that the assessment became due (CTA EB Case No. 563 (CTA Case No. 6200) dated 1 March 2011)
  • Willful failure to file a return (CTA Crim. Case No. 0-013 dated 5 January 2011)
  • A special law cannot be repealed, amended or altered by mere implication in a subsequent general law (CTA Case No. 7867 dated 4 January 2011)

Executive issuances

Bureau of Customs (BOC)
  • Retro-verification, audit and reconciliation of insurance premium declarations in all 2010 importations (Customs Memorandum Circular No. 18-2011 dated 18 March 2011)
Securities and Exchange Commission (SEC)
  • Definition of Gross Income under Section 126 of the Corporation Code (SEC Opinion No. 11-14 dated 09 March 2011)
  • Foreign ownership restriction on holding companies (SEC OGC Opinion No. 11-15 dated 15 February 2011)

Meet us

  • Isla Lipana & Co. names new Assurance partner