Philippine Taxation: Client Advisory Letter (July-August 2009)


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Lead article - Chairman's message

As the new Chairman and Senior Partner, I look forward to continuing the many great things the firm has accomplished, to carry on with all the right things we are doing and to inspire all our stakeholders with renewed eagerness to translate our corporate values into action. Our commitment to thought leadership through our various publications is but one of the vast resources the firm has to offer.

BIR issuances

  • Preferential tax rate of 15% imposed on dividends received by an Australian company pursuant to the tax deemed paid principle (DA(C-079) 266-2009) dated June 3, 2009
  • Tax consequences of declaring property dividends (DA(-086) 284-2009 dated June 8, 2009)
  • Transfer of shares pursuant to reorganization is not subject to CGT and donor’s tax (DA(C-097) 311-2009 dated June 22, 2009)
  • Sale of vehicle used exclusively within Freeport Zone is subject to 0% VAT (DA(VAT-070) 392-2009 dated July 22, 2009)
  • Tax implications of the transfer of nominee shares of stocks (DA(C-126) 371-2009 dated July 14, 2009)
  • Foreign travel expense not subject to FBT and deductible from gross income (DA(ECB-019) 389-2009 July 22, 2009)
  • Tax treatment of real property transferred by way of dacion en pago (DA(DT-037) 384-2009 July 20, 2009)
  • Managerial and technical positions under Sec. 25 (C) of the Tax Code clarified in relation to the revocation of BIR Ruling No. DA-061-04 (RMC No. 41-2009 dated July 23, 2009)
  • Circularizing the implementation of the eRegistration (eREG) System (Enhanced eTIN) (RMC No. 45-2009 dated July 28, 2009)

Other issuances
Legislative issuances

  • Amusement tax reduced (Republic Act no. 9640 dated May 21, 2009)
  • Sale, barter or exchange of shares of stock listed and traded through the stock exchange is exempt from DST (Republic Act no. 9648 dated June 30, 2009)
  • Amending the Comprehensive Agrarian Reform Law of 1998 (RA 6657) (Republic Act No. 9700 dated August 7, 2009)
  • Bureau of Food and Drugs (BFAD) renamed as Food and Drugs Authority (FDA) (Republic Act No. 9711 dated August 18, 2009)

Executive issuances

  • Application of digital signatures in e-government services (Executive Order No. 810 dated June 15, 2009)

Court decisions 

  • Invalid waiver of the statute of limitations does not toll the running of the prescriptive period to assess (CTA EB No. 454 dated June 3, 2009)
  • Conditions for the refund of CGT and DST on the sale of real property (CTA Case No. 7659 dated June 3, 2009)
  • Fraud; Period within which to issue a valid assessment (CTA EB No. 405 dated June 29, 2009)

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