Академический Документы
Профессиональный Документы
Культура Документы
from sources abroad until the date of his arrival 2Sec.00e1 CTR*.3 -. ) resi+ent alien means an individual whose residence is within the *hilippines and who is not a citizen thereof. 4Sec.00f5 #. ) non-resi+ent alien means an individual whose residence is not within the *hilippines and who is not a citizen thereof. 4Sec.0045 .. ,he term tra+e or business includes the performance of the functions of as a public office. 4Sec. 00S5 +. ,he term tra+e1 business or profession shall not include performance of services by the taxpayer as an employee. 4Sec. 00 CC5 /. ) non-resi+ent alien in+i,i+ual who shall come to the *hilippines and stay therein for an aggregate period of more than 167 days during any calendar year shall be deemed a nonresident alien doing business in the *hilippines 8ection 22!9 notwithstanding 5Sec. 062A32738 9. ,he term corporation shall include: 1. *artnerships, no matter how formed or created, except !i general professional partnerships and !ii a ;oint venture or consortium formed for the purpose of underta1ing construction pro;ects or engaging in petroleum, coal, geothermal and other energy operations pursuant to an operating or consortium agreement under a service contract with the 9overnment0 2. ;oint-stoc1 companies0 3. ;oint accounts !cuentas en participacion 3. associations0 or <. insurance companies 5Sec. 002!38. =. ) 4eneral *rofessional *artners(ip means: a a partnership formed by persons for the sole purpose of exercising their common profession0 and b no part of the income of which is derived from engaging in any trade or business 48ec. 22!- 5. - if t(e requirements are met1 it is exempt from income taxation. (. ?. 9omestic Corporation >created or organized in the *hils. or under its law 4 8ec. 22!# 5 $orei:n corporation > a corporation which is not domestic 5Sec. 002938
C"ASSI$ICATION O$ TA *A#ERS:
a. In+i,i+uals 1 citizens 1 1.1. resident citizens !"# 2 1.2. non-resident citizens !$"# 1.3 %#&' 2 aliens (.1 resident aliens !") (.2 non-resident aliens 2.2.1.engaged in trade or business within the *hils. !$")+,3 2.2.2.$ot engaged in trade or business within the *hilippines !$")$+,b. Corporations 1 .omestic !.# 2 /oreign 2.1 resident foreign corporation !"/# 2.2 non-resident foreign corporation !$"/# c. Estates d. Trusts
@. Resi+ent $orei:n Corporation > engaged in trade or business within the *hilippines 5Sec. 002;38 A. Non-resi+ent $orei:n Corp. > not engaged in trade or business within the *hilippines 5Sec. 002I38
ON"# RESI9ENT CITI<ENS an+ 9O%ESTIC COR*ORATIONS are taxable for income +eri,e+ from sources &it(in an+ &it(out t(e *(ilippines. All ot(er income taxpa=ers are taxable onl= for income +eri,e+ from sources &it(in t(e *(ilippines.
3. <. B. D.
$%,+: income therefrom is taxable #ompensation for in;uries or sic1ness0 (ncome exempt under ,reaty0 "etirement benefits, pension, gratuities, etc. Ciscellaneous items
Retirement !enefits1 *ension1 4ratuities1 Etc.: 1. those derived under ".). DB31 !pertains to
private firms without retirement trust fund 0
3.
<. B. D.
%iscellaneous Items
1. *assive income derived by foreign government in the *hilippines0 2. (ncome derived from any public utility or from the exercise of any governmental function0 3. *rizes and awards made primarily in recognition of religious, charitable, scientific, educational, artistic, literary, or civic achievement !#2A)"+8 : Requisites: a. recipient selected without any action on his part0 b. recipient not re2uired to render substantial future services. 3. *rizes and awards granted to athletes in sports competitions and sanctioned by their national sports association 0 <. 13th month pay and other benefits up to *37,777.770 B. 98(8,888, Cedicare and union dues of individuals0 D. 9ains derived from debt securities with a maturity of more than < years0 6. 9ains from redemption of shares in Cutual /und
4ROSS INCO%E
9efinition: (ncludes but not limited to the following : 1. compensation0 2. business income0 3. gains form dealings in property0 3. interests0 <. rents0 B. royalties0 D. dividends0 6. annuities0 G. prizes and winnings0 17. pensions0 11. partnerFs share in the net income of the general professional partnership 2Sec. 301 CTR*3 >E#: . -(9 #)"H*I
9E9-CTIONS
9efinition: (tems or amounts which the law allows to be deducted from gross income in order to arrive at the taxable income.
>in+s of 9e+uctions:
1. Optional stan+ar+ +e+uctions >17L of the gross income. 0. Itemi)e+ +e+uctions !a ordinary AN9 necessary expenses !b interests !c taxes !d losses !e bad debts !f depreciation of property0 !g depletion of oil and gas wells and mines0 !h charitable and other contributions0 !i research and development0 !; pension trust contributions of employees0 and !1 premium payments on health andEor hospitalization insurance 3. *ersonal an+ a++itional exemptions 3. Special +e+uctions A applicable only to (nsurance companies, whether domestic or foreign. 2Sec. 3B1 CTR*3. a. OR9INAR# AN9 NECESSAR# E *ENSES:
<.
interest paid in advance thru discount or otherwise, E CE*T that it is deductible in the year indebtedness is paid.
c. TA ES:
Requisites to be deductible:
1. must be in connection with taxpayerFs business0 2. tax must be imposed by law on , and payable by, taxpayer0 and 3. paid or incurred during the taxable year.
Exceptions:
1. 2. 3. 3. <.
income tax0 estate and donorFs tax0 special assessments0 excess electric consumption tax0 foreign income tax, war profits and excess profits tax, if the taxpayer ma1es use of tax credit0 and B. final taxes, being in the nature of income tax. - ,axes allowed as deductions, when refunded or credited, shall be included as part of gross income in the year of receipt to the extent of the income tax benefit of said deduction !,ax -enefit "ule . - /or $")+,- and "/#, taxes paid or incurred are allowed as deductions only if and to the extent that they are connected from income within the *hilippines. +. "OSSES:
Requisites to be deductible: 1. actually sustained0 2. connected with the business, trade or profession0 and 3. not compensated by insurance or otherwise.
T(e follo&in: losses are subCect to special rules un+er t(e CTR* 2taDe note of t(e pertinent pro,isions3: 1. #apital losses 2. 8ecurities becoming worthless 3. &ash sales 3. &agering losses <. )bandonment losses B. Aosses of mines other than oil and gas wells e. !A9 9E!TS
Capital Expen+iture:
)n expenditure that benefits not only the current period but also future periods. (t is not deductible but depreciable, E CE*T, if the taxpayer is a non-profit proprietary educational institution which may elect either to deduct the capital expense or depreciate it.
b. INTEREST:
Requisites to be deductible:
Requisites to be deductible:
1. debt belongs to the taxpayer0 2. debt must be related to the business or profession of the taxpayer0 3. interest should be legally due0 3. interest paid or accrued during the taxable year. interest paid on indebtedness to finance petroleum explorations0 interest on transactions by related parties !transactions-at-arms-length : interest to purchase or carry tax-exempt obligations0 dividend payments cannot be deducted as interest0 and
1. Kalid and subsisting debt0 2. .ebt must be actually ascertained to be worthless and uncollectible0 3. %bligation is not between related parties !8ec. 3B b #,"* 0 3. .ebt is expensed within the year0 and <. .ebt is connected with profession, trade or business.
) recovery of bad debts previously deducted from gross income constitutes taxable income if in the year the account was written off, the deduction resulted in a tax benefit.
f.
9E*RECIATION: 1. Cust be reasonable0 2. Cust be on property used in the conduct of the business0 3. Cust be expensed during the taxable year0
Requisites to be deductible:
:. 9E*"ETION O$ OI" AN9 4AS 'E""S AN9 %INES - same re2uisites as depreciation (. C;ARITA!"E AN9 OT;ER CONTRI!-TIONS
3. .ependent does not include the parents, brothers and sisters of the taxpayer. 3. (f there is any change of status at any time during the taxable year, the law expressly favors the taxpayer. <. /or a $")+,-, only to the extent allowed by his country to /ilipinos not residing therein, but not to exceed the above amounts. )dditionally, he must file a true and accurate return of the total income received by such $")+,- from all sources within the *hilippines.
*artial 9e+uction:
-
not in excess of <L of taxable income in case of a corporation not in excess of 17L of the taxable income in case of an individual
9e+uctible in $ull:
1. .onations to the government 2. .onation to certain foreign institutions international organizations. 3. .onations to certain accredited $9%Fs .
or
1. Jnmarried or legally separated person with one or both parents, or one or more brothers or sisters, or one or more legitimate, recognized natural or legally adopted children living with and dependent upon the taxpayer for their chief support0 and 2. &here such brother E sister or children are not more than 21 years of age, unmarried and not gainfully employed, or where such dependents regardless of age, are incapable of self > support because of mental or physical defect.
1. legitimate, illegitimate or legally adopted child of the taxpayer 2. chiefly dependent upon and living with the taxpayer 3. not more than 21 years old, unmarried )$. not gainfully employed or where such dependents regardless of age are incapable of self-support because of mental of physical defect.
Clarificator= Illustrations:
1. (f only 1G years old but married, not 2ualified as a dependent. 2. +ven if 2< years old but physically incapacitated, 2ualified as a dependent.
<
Transaction Resultin: in Taxable 4ains but Non-Reco:nition of "osses a. 8ale or exchange between related parties0 b. &ash sales by non-dealers of securities and when not sub;ect to the stoc1 transfer tax0 c. +xchanges not solely in 1ind in merger and consolidation0 and d. 8ales or exchanges that are not at arms length.
In+i,i+uals Exempt $rom $ilin: Income Tax Return: 1. (ndividual whose gross income does not exceed total personal and additional exemptions0 2. (ndividual with respect to pure compensation income derived from sources within the *hils., the income tax on which has been correctly withheld0 3. (ndividual whose sole income has been sub;ected to final withholding income tax0 3. (ndividual who is exempt from income tax.
TRANS$ER TA ES
TRANS$ER TA 1. ,ax on transfer of property. 2. "ates are lower --<L to 27L estate tax -- 2L to 1< L donorFs tax 3. Aesser exemptions INCO%E TA 1. ,ax on income 2. "ates are higher -- <L to 32L
Sale or Exc(an:e of Real *ropert=1 an+ S(ares of StocDs of 9omestic Corporation ;el+ as Capital Assets SubCect to Capital 4ains Tax As to individuals and domestic corporations 1. On real propert= > each independent transaction is sub;ect to the final tax of BL on the gross selling price or the fair mar1et value at the time of sale, whichever is higher, regardless of gain or loss 2. S(ares of stocD of domestic corporation not traded thru a local exchange taxed at the rate of <L for net capital gains not over *177,, and 17L in excess of *177,.
3. Core exemptions
a. +xchange solely in 1ind in mergers and consolidation0 b. +xchange of property for stoc1s resulting in a change in corporate control
4ROSS ESTATE 2Sec. .61 CTR*3 A. As to resi+ent alien or $ilipino +ece+ent - all real, tangible personal, intangible personal property wherever situated. A. As to non-resi+ent alien +ece+ent - all real and tangible personal property situated in the *hil. - (ntangible personal property with a situs in the *hil. Jnless exempted on the basis of reciprocity. Inclusions in t(e 4ross Estate 2Sec. .61 CTR*3:
a. .ecedentFs interest b. ,ransfer in contemplation of death c. "evocable transfer d. ,ransfer under general power of appointment e. *roceeds of life insurance f. ,ransfers for insufficient consideration g. *rior interests
1. ,he merger of usufruct in the owner of the na1ed title0 2. /ideicommisary substitution0
3. ,he transmission from the first heir, legatee or donee in favor of another beneficiary, in accordance with the will of the predecessor0 and 3. )ll be2uests, devices, legacies or transfers to social welfare, cultural and charitable institutions no part of the net income of which inures to the benefit of any individual0 *rovided, that not more than 37L of the said be2uests, legacies or transfers shall be used by such institutions for administration purposes.
1. arising from fire, storm, shipwrec1, or other casualty, robbery, theft or embezzlement0 2. $ot compensated by insurance or otherwise0 3. $ot claimed as deduction in an income tax return of the taxable estate0 3. %ccurring during the settlement of the estate0 and <. %ccurring before the last day for the payment of the estate tax !last day to pay: six months after the decedentFs death .
,he gross estate shall be valued at its fair mar1et value at the time of death of the decedent.
Requisites to be deductible: 1. ,he disposition is in a last will and testament 2. ,o ta1e effect after death 3. (n favor of the government of the *hil., or any political subdivision thereof 3. /or exclusive public purposes.
Fanis(in: 9e+uction:
Requisites to be deductible: 1. the present decedent died within < years from transfer of the property from a prior decedent or donor. 2. ,he property must be located in the *hils. 3. ,he property formed part of the taxable estate of the prior decedent, or of the taxable gift of the donor. 3. ,he estate tax or donorFs tax on the gift must have been finally determined and paid. <. ,he property must be identified as the one received from the prior decedent, or something ac2uired in exchange therefor. B. $o vanishing deduction on the property was allowable to the estate of the prior decedent.
$amil= ;ome:
Requisites to be deductible: 1. 8aid family home must have been the decedentFs family home. 2. 8aid fact must be certified to by the barangay captain of the locality where it is located. 3. Caximum of *1,777,777
%e+ical Expenses:
$uneral Expenses:
,he amount deductible is the lowest among the following: 1. actual funeral expenses 2. <L of the gross estate 3. *277,777
Requisites to be deductible: 1. incurred within one year prior to his death 2. 8ubstantiated with receipts 3. Caximum of *<77,777 9E9-CTIONS ON ESTATE TA A**"ICA!"E TO NON-RESI9ENT A"IENS 7. +xpenses, losses, indebtedness and taxes
Requisites to be deductible: 1. ,he debt instrument must be notarized 2. (f loan was contracted within 3 years before the death of the decedent, the administrator or executor shall submit a statement showing the disposition of the proceeds of the loan. $.-.: ,hese re2uisites do not apply if the claim did not arise from contractual obligations.
!+A(,
$ormula: *hil. 9ross +state &orld 9ross +state 2. ,ransfer for public use. 3. Kanishing deduction *hilippines. N &orld +A(,
Taxes:
on
property
in
the
The following are not deductible: 1. income tax on income received after death 2. property taxes not accrued before death 3. estate tax
"osses:
Requisites to be deductible:
3 - ,he tax credit is whichever is lower between: 1. +state tax paid to the foreign country 2. $,+, foreign country N *hil. estate tax $,+, world !$,+ - $et ,axable +state b. %ore t(an one forei:n countr= - ,he credit shall be that which is the lower amount between Aimit ) and Aimit "imit A. &hichever is lower between: 1. +state tax paid to foreign country 2. $,+, foreign country N *hil. estate tax $,+, world "imit !. &hichever is lower between: 1. total of estate taxes paid to all foreign countries 2. $,+ outside *hil. N *hil. estate tax $,+, world
c.
their legitimate, illegitimate or adopted children to the extent of the first *17,777. b. 9ifts made to or for the use of the $ational 9overnment or any entity created by any of its agencies which is not conducted for profit, or to any political subdivision of the said government. 9ifts in favor of educational, charitable, religious, cultural or social welfare corporation, institutions, foundations, trust or philanthropic organization, research institution or organization, accredited non-government organization !$9% . *rovided, that no more than 37L of said gifts shall be used by such donee for administration purposes. 2. 9ifts made by a non-resident not a citizen of the *hil. a. same as !b b. same as !c except accredited nongovernment organization !$9%
7.
9ONORGS TA Requisites: 2A9IC3
1. capacity of the donor 2. donative intent 3. delivery, whether actual or constructive, of the sub;ect gift 3. acceptance by the donee
.onor was a /ilipino citizen or resident alien 2. )t time of foreign donation 3. .onorFs taxes of any character and description 3. )re imposed and paid by the authority of a foreign country.
spouse, ancestor and lineal descendant, or of a relative by consanguinity in the collateral within the 3th civil degree.
FORMULA:
1. ,he amount of the credit in respect to the tax paid to any country shall not exceed the same proportion of the tax against which such credit is ta1en, which the decedentFs net gifts situated within such country taxable under the $("# bears to his entire net gift0 and 0. ,he total amount of the credit shall not exceed the same proportion of the tax against which such credit is ta1en, which the decedentFs net gift situated outside the *hilippines taxable under the $("# bears to his entire net gift.
FORMULA:
b. %n donation of a subse2uent date during the year: 9ross gifts made on this date Aess: .eductions from gross gifts $et gifts )dd: )ll prior net gifts within the year )ggregate net gifts N ,ax "ate .onorFs tax on aggregate net gifts Aess: .onorFs tax on all prior net gifts .onorFs tax on the net gifts on this date xxx xxx xxx xxx xxx xxx xxx xxx xxx
,he allowable tax credit is the lower amount between the tax credit limit under !a and !b .
non-residents of goods assembled or manufactured in the *hilippines for delivery to residents in the *hilippines and paid for in convertible foreign currency remitted through the ban1ing system in the *hilippines.
more than *177, but less than *<<7, >3L percentage tax less than *177, > no business tax liability
Elements of FAT :
1. sale must be made in the *hilippines0 2. sale must be of taxable goods, properties or services0 and 3. sale must be made by a taxable person in the course or furtherance of his business.
$ot taxable sales and therefore not ta1en into account in determining turn-over or K),registration purposes
Input Tax tax on purchase price of goods which is passed on or shifted to a buyer E purchaser Elessee by the supplier E seller E lessor. (t is the K), paid by a K),-registered person in the course of his trade or business.
Re:istration Requirements:
7. %an+ator= A every person who in the course of trade or business, sells, barters, exchanges, leases goods or services for others, if the aggregate amount of actual or expected gross sales and E or gross receipts exceeds *<<7, for any 12-month period. 0. Optional -- any of the following persons may, at their option, apply for K), registration: a. seller of goods or services whose taxable sale or gross receipts do not exceed *66H, for any 12-month period0 b. seller of agricultural or marine food products in their original state0 c. seller of fertilizer, seeds, seedlings and fingerlings, fish live stoc1 and poultry feeds, including ingredients whether locally produced or imported, used in the manufacture of finished foods0 d. seller of non-food agricultural, marine and forest products in their original state0
goods or services by any person registered or re2uired to register for K), purposes.
Transitional Input Tax Cre+it person who becomes liable to K), or any person who elects to be a K),-registered person shall, sub;ect to the filing of an inventory of goods, material and supplies e2uivalent to 6L of value of such inventory or the actual K), paid on such goods, materials and supplies, whichever is higher, which shall be creditable against the output tax.
of goods from the *hilippines to a foreign #ountry irrespective of any shipping arrangement that may be agreed upon which may influence or determine the transfer of ownership of the goods so exported, or foreign-currency denominated sales.
e. seller of cotton and cotton seeds in the original state, and copra. " ##0 FANC $ N % : Ite&' ( t) e* re+er t) exp)rt 'a,e' )-,.
1. *lace of sale! with branch or sales outlet therein : Cunicipality or city where the branch or outlet is located. 2. *lace of sale !no branch or sales outlet : Cunicipality or city of principal office !not in the place of sale . 3. (f manufacturer, assembler, contractor, producer or exporter !C)#*+ with factory, pro;ect office, plant or plantation !/*** : a. 37L of recorded sales in the principal office: city or municipality where the principal office is located0 b. D7L of recorded sales in the principal office: city or municipality where the /*** is located !pro rata if /*** are located in different municipalities or cities . c. (f plantation is located in some other place than that where the factory is located, the foregoing D7L shall be subdivided as follows: - B7L to the city or municipality where the factory is located, - 37L to the city or municipality where the plantation is located.
1. Aocal taxation, and 2. "eal property taxation N ! : !oth aspects are governed b" the #ocal $overnment Code %#$C&
&here the $ational 9overnment elects to tax a particular area, it impliedly withholds from the local government the delegated power to tax the same field. ,his doctrine principally rests upon the intention of #ongress.
Exclu+e+ impositions 2pursuant to t(e +octrine of preemption3: 1. ,axes which are levied under the $("#, unless otherwise provided by A9# of 1GG10 2. ,axes, fees, etc. which are imposed under the ,ariffs and #ustoms #ode0 3. ,axes, fees, etc., the imposition of which contravenes existing governmental policies or which violates the fundamental principles of taxation0 and 3. ,axes, fees and other charges imposed under special law.
C(aracteristics:
1. 2. 3. 3.
.irect on ownership0 ad valorem tax proportionate creates a single indivisible obligation 6. local tax >e=: SA*O"
% ) * 8 A
17
Taxin: Aut(orities:
1. *rovince, at the rate of not S 1L of assessed value0 2. #ity at the rate of not S 2L0 and 3. Cunicipality within Cetro Canila at the rate of not S 2L.
1. -asic real property tax0 2. 1L additional real estate tax to finance the 8pecial +ducation /und0 3. <L additional tax on idle lands0 and 3. 8pecial levy or special assessments !may be imposed even by municipalities outside Cetro Canila .
*roperties Exempt from Real *ropert= Tax 2Sec. 7?31 7??7 "4C3:
1. "eal property owned by the government except when the beneficial use thereof has been granted to a taxable person0 2. charitable institutions, churches, personages or convents appurtenant thereto, mos2ues, nonprofit or religious cemeteries and all lands, buildings and improvements actually, directly and exclusively used for religious, charitable or educational purposes !)rt. K(, 8ec. 26, #onstitution 0 3. machineries and e2uipment that are actually, directly and exclusively used by local water utilities and 9%##Fs engaged in the supply and distribution of water andEor electric power0 3. real property owned by duly registered cooperatives as provided for in ") BG360 and <. machinery and e2uipment used for pollution control and environmental protection.
Juris+iction of Collector of Customs o,er importation of articles 1. #ause all articles for importation to be entered in the customhouse, 2. #ause all such articles to be appraised and classified, 3. )ssess and collect the duties, taxes and other charges thereon, and 3. =old possession of all imported articles until the duties, taxes and other charges are paid thereon. 2Sec. 70HI1 TCC3
1. )ll seas within the ;urisdiction of the *hilippines 2. )ll coasts, ports, airports, harbors, bays, rivers and inland waters whether navigable or not from the sea. 27st par1 Sec. IH31 TCC3
11
and legal permit for withdrawal shall have been granted. b. (n case the articles are free of duties, taxes and other charges, until they have legally left the ;urisdiction of the customs 2Sec. 70H01 TCC3
Re:ular 9uties:
3.
Special +uties
(mported goods must be entered in a customhouse at their port of entry otherwise they shall be considered as contraband and the importer is liable for smuggling !8ee 8ec. 171, ,## .
8pecial customs duties are additional import duties imposed on specific 1inds of imported articles under certain conditions.
,he special customs duties are imposed for the protection of consumers and manufacturers, as well as *hil. products from undue competition posed by foreign-made products.
a. A personal +ebt which can be discharged only by payment in full thereof0 b. A lien upon the imported articles while they are in custody or sub;ect to the control of the govFt 2Sec. 70H/1 TCC3.
9ra&bacD
) device resorted to for enabling a commodity affected by taxes to be exported and sold in foreign mar1ets upon the same terms as if it had not been taxed at all "U. C:2ac) S)-' 7' C),,ect)r )+ C3't)&'* 5; !:2, #<5$
Import Entr=
(t is a declaration to the -%# showing particulars of the imported article that will enable the customs authorities to determine the correct duties. )n importer is re2uired to file an import entry. (t must be accomplished from disembar1ing of last cargo from vessel.
(t is the invoice value of the goods plus freight, insurance, costs, expenses and other necessary expenses. ,his replaces the =ome #onsumption Kalue as basis of valuation of goods.
12
$),J"+
.ifference between the actual price and the normal value of the article. 8pecial #ommittee on )nti.umping !composed of the 8ec. of /inance as #hairman0 Cembers: the 8ec. of .,(0 and either the 8ec. of )griculture if article in 2uestion is agri. product or the 8ec. of Aabor if non-agri.
)ny amount not exceeding 177L ad valorem of the sub;ect articles *resident of the *hilippines
#ommissioner of #ustoms
,he *resident may fix tariff rates, import and export 2uotas, etc. under ,## 2See Sec. 0.1 Art. FI1 Constitution an+ Sec. /H71 TCC3
F. TA RE%E9IES
TA RE%E9IES -N9ER T;E NATIONA" INTERNA" REFEN-E CO9E
I TAX REMEDIES 6OVERNMENT OF T=E
T(e follo&in: are :enerall= t(e tax reme+ies of t(e :o,ernment to effect collection of taxes:
). ,ax Aien !8ec. 21G -. #ompromise !8ec. 273 #. .istraint !)ctual and #onstructive !8ecs. 27<-276 .. Aevy !8ec. 27D+. /orfeiture of *roperty !8ec. 21< /. #ivil )ction !8ec. 227 9. #riminal )ction !8ecs. 227, 221, and 22G =. 8uspension of business operations in violation of K), !8ec. 11< (. +nforcement of )dministrative /ine
Importance
1. 2.
,hey enhance and support the governmentFs tax collection. ,hey are safeguards of taxpayerFs rights against arbitrary action.
A. Tax "ien
Tax collection cannot be restraine+ b= court inCunction 2Sec. 07?1 CTR*3 ,ustification: Aifeblood ,heory.
9efinition: (t is a legal claim or charge on property, either real or personal, established by law as a securit= in default of the payment of taxes !<1 )m?ur 661 . 9enerally, it attaches to the property irrespective of ownership or transfer thereof.
13 ,he tax, together with interests, penalties, and costs that may accrue in addition thereto is a lien upon all propert= an+ ri:(ts to propert= belon:in: to t(e taxpa=er. ,he lien shall not be valid against any mortgagee, purchaser, or ;udgment creditor until notice of such lien shall be filed by the #ommissioner of (nternal "evenue in the %ffice of the "egister of .eeds of the province or city where the property of the taxpayer is situated or located !Sec. 07?1 CTR*3.
1.
2.
the basic tax involved exceeds *1,777,777.77, or the settlement offered is less than the minimum compromise rates !C#" .
N ! : ,he C#" may be less than the prescribed rates of 17L or 37L, as the case may be, provided it is approved by the +valuation -oard.
!. Compromise
9efinition: ) contract whereby the parties, by reciprocal concessions, avoid a litigation or put an end to one already commenced !Art. 0H0., Ne& Ci,il Co+e .
$eneral Rule: #riminal violations may be compromised. Exceptions: 1. ,hose already filed in court 2. ,hose involving fraud 48ec. 273!) , #,"*5.
Requisites 2TAO3:
7. ,he taxpayer must have a tax liabilit=. 0. ,here must be an offer !by the taxpayer of 3.
an amount to be paid by the taxpayer ,here must be an acceptance !by the #ommissioner or taxpayer as the case may be of the offer in the settlement of the original claim.
Extent of t(e CommissionerGs +iscretion to compromise criminal ,iolations: 7. !efore the complaint is filed with the .rosecutor/s -ffice: ,he #(" has full discretion to compromise except those involving fraud. 0. After the complaint is filed with the .rosecutor/s -ffice but before the information is filed with the court: ,he #(" can still compromise provided the prosecutor must give consent. 3. After information is filed with the court: ,he #(" is no longer permitted to compromise with or without the consent of the *rosecutor !*eople vs. Cagdaluyo, )pril 27, 1GB1 .
0.
fails to abi+e t(e tax compromise: 7. Enforce the compromise a. (f it is a Cu+icial compromise, it can be enforced b= mere execution. ) ;udicial compromise is one where a decision based on the compromise agreement is rendered by the court on re2uest of the parties. b. )ny other compromise is extraCu+icial and li1e any other contract can only be enforced b= court action. 0. "egard it as rescin+e+ and insist upon original demand !)rt. 2731, #ivil #ode .
Commissioner ma= compromise an= internal re,enue tax &(en A 1. ) reasonable +oubt as to the validity of the claim against the taxpayer exists0 or 2. ,he financial position of the taxpayer demonstrates a clear inabilit= to pa= the assessed tax 48ec. 273!) , #,"*5. (n such case, the taxpayer should waive the confidentiality privilege on ban1 deposits under ") 137< !8ee 8ec. B/2, #,"* .
Compromise *enalt=
(t is an amount of money which the taxpayer pays to compromise a tax violation. ,his is paid in lieu of criminal prosecution. ) taxpayer cannot be compelled to pay a compromise penalty. (f he does not want to pay, the #(" must institute a criminal action.
C. 9istraint
9efinition: (t is the seizure by the government of personal property, tangible or intangible, to enforce the payment of taxes. ,he property may be offered in a public sale, if taxes are not voluntarily paid. (t is a summary remedy.
13
0.
,he warrant is a summary procedure PforcingQ the taxpayer to pay. ,he receipt of a warrant may or may not parta1e the character of a final decision. (f it is an indication of a final decision, the taxpayer may appeal to the #,) within 37 days from service of the warrant.
+istraint: 7. Ca1e an account of the personal properties distrained0 0. Si:n the list of personal properties distrained to which shall be added, a statement of the sum demanded and note of the time and place of sale0 3. "ea,e either with the owner or person from whose possession such personal properties were ta1en, or at the dwelling or place of business of such person with someone of suitable age and discretion !8ec. 276, #,"*
*roce+ures for t(e actual +istraint or :arnis(ment: 1. *ersonal *ropert= 8ervice of &arrant of .istraint I Ser,ice of t(e &arrant of +istraint upon the person in possession of the taxpayerFs property !8ec. 276, #,"* . II *ostin: of notice in not less than two !2 public places in the municipality or city !8ec. 27G, #,"* III $otice to the taxpayer specifying the time an+ place of sale and the articles distrained.
T(e taxpa=erGs propert= ma= be place+ un+er constructi,e +istraint &(en (e: 7. is retirin: from any business sub;ect to tax0 or 2. is intending to > a. lea,e the *hilippines, or b. remo,e his property therefrom, or c. (i+e or conceal his property, or 3. is performing any act tending to obstruct the proceeding for collecting the tax due or which may be due from him !8ec. 27B, $("# .
*osting of $otice
1<
"eal property may be levied upon before1 simultaneousl=1 or after t(e +istraint of personal property belonging to the delin2uent !8ec. 27D-, #,"* 0 and the remedy by distraint and levy may be repeated if necessary until the full amount, including all expenses, is collected !8ec. 21D, #,"* .
ACTUAL VS DISTRAINT )#,J)A .(8,")($, Cade only on the property of a delin2uent taxpayer ,here is ta1ing of possession
8ervice of $otice
8ale
)n immediate step for collection of taxes -oth )re summary remedies for the collection of taxes0 "efer only to personal property0 and #annot be availed of where the amount of the tax involved is not more than *177
.isposition
1B
in case of real property levied upon and sold, or forfeited to the government. -oth )re summary remedies for the collection of taxes0 and #annot be availed of where the amount of the tax involved is not more than *177
E. $orfeiture
9efinition: divestiture of property without compensation, in conse2uence of a default or offense.
*rescripti,e *erio+s for t(e Assessment an+ Collection of Taxes Rationale of (erein prescripti,e perio+s:
8uch periods are designated to secure the taxpayers against unreasonable investigation after the lapse of the period prescribed. ,hey are also beneficial to the government because tax officers will be obliged to act promptly.
0.
Rules on *rescription:
Effect of t(e forfeiture of propert= &it( respect to title t(ereto: ,he effect is to transfer the title to the specific thing from the owner to the government.
1. &hen the tax law itself is silent on prescription, the tax is imprescriptible0 2. &hen no return is re2uired, tax is imprescriptible0 $-: "emedy of taxpayer is to file a return. 3. .efense of prescription is waivable0 3. *rovisions on prescription, being remedial in nature, should be liberally interpreted to carry out its intent.
2.
9efenses &(ic( are preclu+e+ b= final an+ executor= assessments: 1. (nvalidity or illegality of the assessment0 and 2. *rescription of the governmentFs right to assess.
1D
*rescripti,e *erio+ for t(e Collection of Taxes: $eneral .eriods for the Collection of Taxes: < years > from assessment or within period for collection agreed upon in writing before expiration of the <-year period !8ec. 222, #,"* . 17 years > without assessment in case of false or fraudulent return with intent to evade or failure to file return !8ec. 222, #,"* .
/iling of claim for refun+ or tax cre+it within 2 years from date of payment regardless of any supervening cause !8ec. 22G, #,"* .
Ju+icial
t(e statute of limitations: 7. &hen the CIR is pro(ibite+ from ma1ing the assessment or beginning the distraint or levy or a proceeding in court, and for sixty !B7 days thereafter0 0. &hen the taxpa=er requests for a reconsi+eration which is granted by the #("0 3. &hen the taxpa=er cannot be locate+ in the address given by him in the return, unless he informs the #(" of any change in his address. /. &hen the warrant of distraint or levy is duly served, an+ no propert= is locate+0 and 6. &hen the taxpa=er is out of t(e *(ilippines !8ec. 223, #,"* .
7. Ci,il Action A a. Appeal to t(e Court of Tax Appeals > within 37 days from receipt of decision on the protest or from the lapse of 167 days due to inaction of the #ommissioner !8ec. 226, #,"* . b. )ction to contest forfeiture of chattel !8ec. 231, #,"* 0 and c. )ction for +ama:es !8ec. 22D, #,"* . 0. Criminal Action A a. /iling of criminal complaint a:ainst errin: !IR officials an+ emplo=ees. b. InCunction > when the #,) in its opinion the collection by the -(" may ;eopardize taxpayer.
$ilin: of claim for Tax Refun+ or Tax Cre+it 4roun+s for filin: a claim for tax refun+ or
tax cre+it: 7. ,ax is collected erroneousl= or ille:all=. 0. *enalty is collected &it(out aut(orit=. 3. 8um collected is excessi,e.
A tax return is consi+ere+ $I"E9 for purposes of startin: t(e runnin: of t(e perio+ of limitations if: 7. ,he return is ,ali+ > it has complied substantially with the re2uirements of the law0 and 2. ,he return is appropriate > it is a return for the particular tax re2uired by law. A +efecti,e tax return is t(e same as if no return &as file+ at all.
7. #laim must be in &ritin:0 0. (t must be filed with the #(" within T'O 203
#EARS after the payment of the tax or penalty. &here the payment was made by wrongly crediting a prior over payment, the two year period should start from the date such credit was allowed. 8how proof of pa=ment.
3.
*erio+: 1. ,here is a pending litigation between the 9overnment and the taxpayer0 and 0. #(" in that litigated case agreed to abide by the decision of the 8# as to the collection of taxes relative thereto "!a-a. E,ectr2c C) 7' C),,ect)r* Ma. 50* 1/#0$
16
Re:lementar= *erio+s in Income Tax Impose+ b= "a& upon t(e Taxpa=er 2pursuant to Re,. Re:. No. 70-??1 Sec. 00. of t(e CTR*1 an+ Rules of Court3
-(" ma1es a tax assessment
(f taxpayer is not satisfied with the assessment file a protest within 37 days from receipt thereof
Submit supportin: +ocuments within B7 days from date of the filing of the protest
(f protest is denied, ele,ate the matter to the #ommissioner of (nternal "evenue !#(" within 37 days from receipt of the decision of the #("Fs duly authorized representative officer
*rescripti,e *erio+s in t(e Assessment an+ Collection of "ocal Taxes *rescripti,e *erio+s of Assessment
1. Aocal taxes, fees, or charges > /(K+ !< T+)"8 from the date they became due. !8ec. 1G3, A9# . 2. &hen there is fraud or intent to evade the payment of taxes, fees or charges > ,+$ !17 T+)"8 from discovery of the fraud or intent to evade the payment !8ec. 1G3, A9# .
Appeal to t(e Court of Tax Appeals 2CTA3 within 37 days from receipt of final decision of #(" or his duly authorized representative !the taxpayer has the option to appeal straight to the #,) upon receipt of the decision of the #("Fs duly authorized representative
(f the #(" or his duly authorized representative fails to act on t(e protest &it(in 7.H +a=s from date of submission by taxpayer, the latter may appeal within 37 days from lapse of the 167 day period
Aocal taxes, fees, or charges may be collected &(,=($ /(K+ !< T+)"8 from the date of assessment by administrative or ;udicial action. $o such action shall be instituted after the expiration of such period !8ec. 1G3, A9# .
Appeal to t(e Court of Appeals !#) within 1< days from receipt of the #,)Fs decision
Appeal to t(e Supreme Court within 1< days from receipt of the #)Fs decision
4roun+s for t(e Suspension of t(e Runnin: of t(e *rescripti,e *erio+s: 1. ,he treasurer is legally prevented from the assessment or collection of the tax0 2. ,he taxpayer re2uests for a reinvestigation and executes a waiver in writing before the expiration of the period within which to assess or collect0 and 3. ,he taxpayer is out of the country or otherwise cannot be located !8ec. 1G3, A9# .
II TAX TAX!A>ER
REMEDIES
OF
T=E
T(e follo&in: are t(e reme+ies of t(e taxpa=er in local taxation: (. )dministrative ). *rotest > within B7 days from receipt of assessment !8ec. 1G< A9# . *ayment under protest not necessary -. *a=ment L subsequent refun+ or tax cre+it > within 2 yrs. from payment of tax to local treasurer !8ec. 1GB A9# (t is to be noted that, unli1e in internal revenue taxes, the super,enin: cause applies in local taxation because the period for the filing of claims for refund or credit of local taxes is counted not necessarily from the date of payment but from the date the taxpayer is entitled to a refund or credit.
1G #. Ri:(t of re+emption > 1 yr. /rom the date of sale or from the date of forfeiture !8ec. 161 A9# ((. ?udicial ). Appeal > any 2uestion on constitutionality or legality of tax ordinance within 37 days from effectivity thereof to 8ecretary of ?ustice !8ec. 16D A9# -. Court action > within 37 days after receipt of decision or lapse of B7 days of 8ecretary of ?usticeFs inaction !8ec. 16D A9# - within 37 days from receipt when protest of assessment is denied !8ec. 1G< A9# - if no action is ta1en by the treasurer in refund cases and the two year period is about to lapse !8ec. 1G< A9# - if remedies available does not provide plain, speedy and ade2uate remedy. C. Action for +eclarator= relief .. InCunction > if irreparable damage would be caused to the taxpayer and no ade2uate remedy is available.
). )ppeal > within B7 days from assessment of provincial, city or municipal assessor to A-)) !8ec. 22B A9# within 37 days from receipt of decision of A-)) to #-)) !8ec. 237 A9# in case of denial of refund or credit, appeal to -)) as in protest case !8ec. 2<3 A9# -. #ourt )ction > appeal of #-))Fs decision to 8upreme #ourt by certiorari. #. 8uit assailing validity of tax0 recovery of refund of taxes paid !8ec. B3 *. 3B3 . .. 8uit to declare invalidity of tax due to irregularity in assessment and collection !8ec. B3 *. 3B3 . +. 8uit assailing the validity of tax sale !8ec. 63 *. 3B3
REA" *RO*ERT# TA RE%E9IES I TAX REMEDIES OF T=E LOCAL 6OVERNMENT TO EFFECT COLLECTION OF TAXES
1. "eal *roperty tax lien !8ecs. 23B and 2<1, A9# 0 2. .istraint !8ec. 2<3, A9# 0 3. Aevy !8ec. 2<3, A9# 0 3. #ivil )ction > formal demand not re2uired !8ec. 2BB, A9# 0 <. *urchase of property by local treasurer for want of bidder !8ec. 2B3, A9# .
a. "eal property taxes may be condoned wholly or partially in a given local government unit when i. ,here is general failure of crops0 ii. ,here is substantial decrease in the price of agricultural or agribased products0 or iii. ,here is calamity. b. -y the *resident of the *hilippines when public interest so re2uires.
*roperty that for so many years had not been declared and when discovered owner must pay bac1 taxes plus incremental penalties. )ssessed taxes shall cover not more than ten !17 years prior to the date of the initial assessment.
27 not be allowed in any case where importation is absolutely prohibited or the release would be contrary to law !8ec. 237D ,## ((. ?udicial 2 ). )ppeal > within 1< days to #ommissioner 3 after notification by collector of his decision !8ec. 2313 ,## within 37 days from receipt of decision of the #ommissioner or 8ecretary of /inance to the #,) !8ec. 2373 ,##, 8ec. D ") 112< -. )ction to 2uestion the legality of seizure #. )bandonment !8ec. 1671 ,##
,he party adversely affected !the protestant may file a written protest on his foregoing liability with the #ollector within 1< days after paying the li2uidated amount !the payment under protest rule applies
=earing within 1< days from receipt of the duly presented protest. Jpon termination of the hearing, the #ollector shall decide on the same within 37 days
)ppeal with the #ourt of ,ax )ppeals within 37 days from notice
(f decision of #ommissioner or 8ec. of /inance is adverse to the protestant, he may appeal to the #), and 8# under the same procedure on the left
,he customs protest is re2uired to be filed only in case the liability of the taxpayer for duties, taxes, fees and other charges is determined and the taxpayer disputes said liability.
)ppeal with the #ourt of )ppeals within 1< days from notice
#,), )ppeal by certiorari with the 8upreme #ourt within 1< days from notice
&here there is no dispute, but the claim for refund arises by reason of the happening of supervening events such as when the raw material imported is utilized in the production of finished products subse2uently exported and a duty drawbac1 is claimed.
a. must be in &ritin: b. must point out the particular +ecision or rulin: of t(e Collector of Customs to which exception is ta1en or ob;ection made0 c. must state the :roun+s relied upon for relief0 d. must be limite+ to the sub;ect matter of a sin:le a+Custment0 e. must be file+ when the amount claimed is paid or &it(in 76 +a=s after the payment0 f. protestant must furnis( samples of :oo+s under protest when re2uired.
Reasons for t(e automatic re,ie& of +ecisions a+,erse to t(e 4o,ernment 1. ,o protect the interest of the 9overnment 2. ) favorable decision will not be appealed by the taxpayer and certainly a #ollector will not appeal his own decision. 3. Aifeblood ,heory
Smu::lin:
,he #ollector shall assess, li2uidate, and collect the duties thereon, or detain the said goods if the party liable does not pay the same
). )n act of any person who shall: 4 1. /raudulently import any article contrary to 5 law, or 6 2. )ssist in so doing, or 7 3. "eceive, conceal, buy, sell, facilitate, 8 transport, conceal or sell such article 9 1nowing its illegal importation 2Sec. 3IH71 10 TCC3 3. +xport contrary to law. !Sec. 367/1 TCC3
21 -. ,he *hilippines is divided into various ports of entry > entry other than port of entry, will be 8CJ99A($9. these are in reality attempts to review the #ommissionerMs actuations. $either replevin filed with the ",# will issue. Rationale: .octrine of *rimary ?urisdiction.
E,i+ence for con,iction in smu::lin: cases. Cere possession of the article in 2uestion J$A+88 defendant could explain that his possession is lawful to the satisfaction of the court 2Sec. 3IH71 TCC3. *ayment of the tax due after apprehension is not a valid defense "R)4r2?3e@ 7 CA* 5;0 SCRA 500$
Contraban+: )rticles of prohibited importations or exportations. 2Sec. 367/1 TCC3 T(in:s subCect to confiscation in smu::lin: cases: )nything that was used for smuggling is sub;ect to confiscation, li1e the vessel, plane, etc. "L,a&a4) 7' C)&& )+ C3't)&'* 1/0A$ +N#+*,(%$: #ommon carriers that are not privately chartered cannot be confiscated.
*ersons (a,in: police aut(orit= to enforce t(e Tariff L Customs "a&s an+ effect searc(es1 sei)ures an+ arrests: a. officials of the -%#, district collectors, police officers, agents, inspectors, and guests of the -%#0 b. officers of the *hil. $avy and other members of the )/* and national law enforcement agencies when authorized by the #ommissioner of #ustoms c. officials of the -(" on all cases falling within the regular performances of their duties, when the payment of internal taxes are involved0 d. officers generally empowered by law to effect arrests and execute processes of courts, when acting under the direction of the #ollector. 2Sec. 00H31 TCC3
A+ministrati,e an+ Ju+icial *roce+ures relati,e to Customs Sei)ures an+ $orfeitures .etermination of probable cause and issuance of warrant
L arrest a. Cay seize any vessel, aircraft, cargo, article, animal or other movable property when the same is sub;ect to forfeiture or liable for any time as imposed under tariff and customs laws, rules U regulations b. Cay exercise such powers only in conformity with the laws and provisions of the ,## 2Sec. 00H63
"eport of seizure to the #omm. of #ustoms and the #hairman, #omm. on )udit
Requisites: 7. O,er Fessels a. )n act is done in *hil. &aters which constitutes a violation of the tariff and customs laws b. a pursuit of such vessel began within the ;urisdictional waters which i. may continue beyond the maritime zone, and ii. the vessel may be seized on the high seas. 0. O,er Importe+ Articles a. ,here is a violation of the tariff and customs laws b. )s a conse2uence they may be pursued in the *hils. c. &ith ;urisdiction over them at any place therein for the enforcement of the law. 2 0n+ par. Sec. IH31 TCC3
/ormal hearing
,he ",#s do not have ;urisdiction over seizure and forfeiture proceedings conducted by the -%# and to interfere with these proceedings. ,he #ollector of #ustoms has exclusive ;urisdiction over all 2uestions touching on the seizure and forfeiture of dutiable goods. $o petitions for certiorari, prohibition or mandamus filed with the ",# will lie because
22
con+ucte+: a. enclosures b. dwelling house !there must be search warrant issued by a ;udge c. vessels or aircrafts and persons or articles conveyed therein +. vehicles, beasts and persons e. persons arriving from foreign countries.
1. #riminal proceedings are actions in personam while seizure or forfeiture proceedings are actions in rem. 2. #ustoms compromise does not extinguish criminal liability !*eople vs. .esiderio, $ov. 2B, 1GB< .
importer ma= settle (is obli:ations with the -ureau of #ustoms, in which case the aforesaid articles may be delivered upon payment of the corresponding duties and taxes and compliance with all other legal re2uirements 2Sec. 76H.1 TCC3
Abatement
) manifest in coastwise trade for cargo and passengers transported from one place or port in the *hilippines to another is re2uired when one or both of such places is a port of entry !8ec. G7B, ,## . Canifests are also re2uired of vessel from a foreign port !8ec. 177<, ,## .
,he reduction or non-imposition of customs duties on certain imported materials as a result of: 1. .amage incurred during voyage0 2. .eficiency in contents pac1ages 3. Aoss or destruction of articles after arrival 3. .eath or in;ury of animals
Euer=: Is manifest require+ onl= for importe+ :oo+sK $o. )rticles sub;ect to seizure do not have to be imported goods. Canifests are also re2uired for articles found on vessels or aircraft engaged in coastwise trade "R2?)r 7' R)'a,e'* 111 SCRA 100$.
-nmanifeste+ Car:o is subCect to $orfeiture whether the act of smuggling is established or not under the principle of res ipsa lo2uitur. (t is enough that the cargo was unmanifested and that there was no showing that payment of duties thereon had been made for it to be sub;ect to forfeiture.
Car:o1 sea store1 an+ pro,isions +istin:uis(e+: 1. Car:o: )rticle of value !including foreign currencies , usually movables, other than those as part of sea stores or provisions. 2. Sea Store: (t is where the passengers can buy their necessities. 3. *ro,isions: ,hose necessary for the subsistence of the crew.
$rau+ulent *ractices consi+ere+ as Criminal Offenses a:ainst Customs Re,enue "a&s: a. Jnlawful importation0 b. +ntry of imported or exported article by means of any false or fraudulent practices, invoice, declaration, affidavit, or other documents0 c. +ntry of goods at less than their true weights or measures or upon a classification as to 2uality or value0 d. *ayment of less than the amount due0 e. /iling any false or fraudulent claim for the payment of drawbac1 or refund of duties upon the exportation of merchandise0 or f. /iling any affidavit, certificate or other document to secure to himself or others the payment of any drawbac1, allowance or refund of duties on the exportation of mdse. greater than that legally due thereon. 2Sec. 3IH01 TCC3
$eneral Rule: 8ettlement of cases by payment of fine or redemption of forfeited property is allo&e+. Exceptions: 1. the importation is absolutel= pro(ibite+ or 2. the surrender of the property to the person offering to redeem would be contrar= to la&, or 3. when there is frau+. 2Sec. 03HB1 TCC3
*o&ers of t(e CTA: T(e follo&in: are t(e po&ers of t(e CTA:
1. 2. 3. 3. to administer oat(s0 to recei,e e,i+ence0 to summon witnesses by subpoena0 to re2uire production or papers or documents by subpoena +uces tecum@
Acquittal in Criminal C(ar:e NOT Res Ju+icata in Sei)ure or $orfeiture *rocee+in:s Reasons:
23 <. to punish contempt0 B. to promul:ate rules an+ re:ulations for the conduct of its business0 D. to assess +ama:e against appellant if appeal to #,) is found to be frivolous or dilatory0 6. to suspen+ t(e collection of t(e tax pen+in: appeal0 and G. to ren+er +ecisions on cases brought before it. "+)8%$: 8tate can never be in estoppel and lifeblood theory. "CIR 7' !r)cter a-4 6a&(,e !:2,' M+? C)rp $
Requisites for a Fali+ Suspension of Collection of t(e Tax pen+in: Appeal: There must be a 1. 8howing that collection of the tax may Ceopar+i)e t(e interest of the government and E or the taxpayer0 2. 9eposit of the amount claimed or file a surety bond for not more than double the amount of tax with the #ourt when re2uired0 and 3. 8howing by taxpayer that appeal is not fri,olous nor +ilator=.
refun+ or cre+it an+ institution of a case before t(e CTA allo&e+ ,he law fixes the same period of two !2 years for filing a claim for refund with the #ommissioner and for filing a case with the #,). ,he two-year period for both starts from the date after the payment of the tax or penalty, or from the approval of the application for credit. Obser,ation: (f we are not going to allow the taxpayer to file a refund before the #,) and let him wait for the #("Fs decision, and the latter failed to render a decision within the 2year period, the said taxpayer can no longer file a refund before the #,) because his right to appeal has prescribed.
MOt(er mattersN
,hose controversies which can be considered within the scope of the function of the -(" E -%# under e;usdem generis rule !e.g. action for the nullity of distraint and levy0 2uestioning the propriety of the assessment0 collection of compromise penalties .
23