Tax Alert No. 1 [Revenue Regulations (RR) No. 15-2022 dated 22 November 2022]

04 Jan 2023

Changes in the rate of Creditable Withholding Tax on certain income payments

The Secretary of Finance has issued RR No. 15-2022 to implement some changes in the rate of creditable withholding taxes on certain income payments, i.e. MERALCO payments on the refund arising from certain ERC cases and interest income on certain refunds, as summarized below:

Income Payment	Income Earner	Tax Rate and Tax Base
MERALCO refund arising from the ERC Case No. 2020-043 RC Order promulgated on 19 February 2021 and ERC Case Nos. 2010-069 RC, 2011-088 RC, 2012-054 RC, 2012-054 RC, 2013-056 RC, and 2014-029 RC Orders promulgated on 29 April 2022	Non-residential customers	Fifteen percent (15%) on the gross amount of refund
Interest income on the refund of meter deposits determined, computed and paid in accordance with the Rules to Govern Refund of Meter Deposits to Residential and Non-Residential Customers (approved under ERC Resolution No. 12, Series of 2016 dated 15 April 2016)	Residential and general service customers whose electricity exceeds 200kWh as classified by MERALCO	Ten percent (10%) on the gross amount of interest paid directly to the customers or applied against the customer’s billings
	Non-residential customers	Fifteen percent (15%) on the gross amount of interest paid directly to the customers or applied against the customer’s billings
Interest income on the refund paid through direct payment or application against customer's billings by other Distribution Utilities (DUs) in accordance with ERC Resolution No. 12, Series of 2016 dated 15 April 2016	Residential and general service customers whose electricity exceeds 200kWh as classified by the concerned DU	Ten percent (10%) on the gross amount of interest paid directly to the customers or applied against the customer’s billings
	Non-residential customers	Fifteen percent (15%) on the gross amount of interest paid directly to the customers or applied against the customer’s billings