BIR declogs dockets of tax relief requests

MANILA, Philippines - The Bureau of Internal Revenue (BIR) has fast tracked the resolution of denied applications for tax relief to declog its dockets.

Under Revenue Memorandum Order 4-2016, tax abatement and compromise settlement denials issued by revenue regions and the Large Taxpayers Service will already be deemed final even without further assessment.

Previously, applications would still have to pass through a technical working group (TWG) and the BIR commissioner for evaluation.

“It’s to allow us to solve fast applications which even trace back from previous administrations,” Internal Revenue commissioner Kim Henares said in a phone interview yesterday.

“Anyway, usually if it’s already denied at that level, the TWG and I also deny it, too,” she added.

Once denied, the memorandum said the taxpayer should settle “immediately” the amount due the BIR.

Under Section 244 of the National Internal Revenue Code, the bureau is allowed to enter into compromises with delinquent taxpayers under specific circumstances.

These include taxpayers in civil tax cases or collection cases filed before courts, administrative cases pending before BIR and those with criminal violations, except those already being heard.

The agency also offers tax abatement, when taxpayers can pay their long overdue taxes without penalties and surcharges. The most recent tax abatement program was held in 2010.

Internal Revenue deputy commissioner Estela Sales said evaluation of tax relief applications could take time.

“There is no hard rule on it. So I guess the memorandum addresses this since it usually takes a long time,” Sales said in a phone interview.

Since granting an abatement means forgone revenues, Henares said the BIR is required by law to report to Congress the amount of taxes it cancels under the programs.

The data however is not allowed to be made public, Sales clarified.

“When it’s a denial, it usually ends there since anyway, it will mean collecting the taxes after all for the government,” Henares said.

As of November last year, BIR has already collected P1.327 trillion, up 12 percent from a year ago.