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Business

BIR in talks with taipans on enhanced tax program

- Iris Gonzales -

MANILA, Philippines - The Bureau of Internal Revenue (BIR) is in talks with the country’s taipans and conglomerates to introduce the BIR’s enhanced tax program for these large taxpayers.

BIR Commissioner Joel Tan-Torres said the agency expects to collect more from conglomerates with the enhanced tax measures. “We expect to collect more from them,” he said.

Under the new rules, the BIR would now assign one group from its Large Taxpayers Service (LTS) and Enforcement Service (ES) to audit all companies belonging to one conglomerate.

This is different from the previous practice when various offices of the BIR would conduct the audit, depending on which Revenue District Office a certain company in a conglomerate belongs to.

“This is to better monitor their tran-sactions. It’s evident that if there’s one team looking at the transactions of all companies belonging to one conglomerate, it will be a better audit,” Tan-Torres said in an interview. Tan-Torres is expected to issue the order next week.

The respective BIR teams will then be deployed among the different conglo-merates and are expected to conclude their audits within six months, Tan-Torres said.

These new and enhanced extensive audits will be conducted once a year, he added.

The BIR chief has already met with the Lopez Group and the Sy family for the implementation of the improved tax measures on conglomerates.

The Lopez Group is the family behind listed Benpres Holding Corp. The family is also a major player in the media, public service and utilities industries in the country.

The Sy Group, meanwhile, is the family behind SM Investments Corp., Banco de Oro Universal Bank and owner of China Banking Corp., SM Prime Holdings. It is also into the real estate and land development business.

Conglomerates are groups of related corporations with diversified business activities in different industries which are controlled and operated by a parent corporate entity.

Aside from the Lopez and the Sy families, the other conglomerates in the country are owned by George Ty, Lucio Tan and Andrew Tan, among others.

Tan-Torres said the Sy and the Lopez Groups are welcome to the planned new tax policies and guidelines on conglomerates.

“They’re fine with it as long as the new rules are constantly applied among all conglomerates,” he said.

The BIR has issued policies and guidelines for taxable year 2009 to help address the prevailing tax issues on the operations of these businesses and strengthen the agency’s investigation and enforcement activities in this particular sector.

BENPRES HOLDING CORP

BIR

BUREAU OF INTERNAL REVENUE

CHINA BANKING CORP

COMMISSIONER JOEL TAN-TORRES

CONGLOMERATES

ENFORCEMENT SERVICE

GEORGE TY

INVESTMENTS CORP

LARGE TAXPAYERS SERVICE

TAN-TORRES

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