23 January 2014
The Office of the President has issued Executive Order (“EO”) No. 68-A dated 13 January 2014, to facilitate and simplify the implementation of the VAT Tax Credit Certificates (TCCs) Monetization Program (the “Program”) under Executive Order No. 68 (s. 2012).
The changes introduced by EO 68-A are as follows:
1. The Program gives all qualified VAT registered taxpayers the ability to monetize the full cash value of their outstanding TCCs issued as of 31 December 2012, which shall be verified by the Bureau of Internal Revenue (BIR) or Bureau of Customs (BOC), as the case may be.
2. The Program covers all outstanding VAT TCCs as of 31 December 2012 which have been issued in accordance with Section 112(A), Tax Code and the VAT component of drawback TCCs outstanding as of 31 December 2012, which have been issued in accordance with Section 106(e) of the Tariff and Customs Code of the Philippines.
3. The monetization of outstanding VAT TCCs shall be fully implemented not later than 30 June 2016. Those holders who did not avail of the monetization program shall be paid through cash conversion presently implemented by the BIR which shall be subsequently implemented by the BOC.
4. The BIR and BOC shall no longer issue TCCs for VAT refund, unless applied for by the taxpayer.
EO 68-A deleted the following items in the old EO 68:
The option of VAT TCC holders to collect in advance the discounted value of the VAT TCCs from trustee banks.
The detailed procedures and coordination work between the Department of Finance, Bangko Sentral ng Pilipinas, Bureau of Treasury, and Government Financial Institutions under Section 4, which has been simplified under Item 4 above.
Executive Order No. 68-A states that it is effective upon publication thereof. E.O. 68-A was published in the Manila Bulletin on 17 January 2014.