DEPARTMENT OF FINANCE
The Department of Finance (DOF) issued Revenue Regulations (RR) No. 5-2017, 11 April 2017, to inform all concerned regarding the amendment to certain provisions of RR No. 1-2009 and to prescribe the guidelines for the implementation of the tax privileges of Persons With Disability (PWD) and their benefactors; and tax incentives of establishments granting twenty percent (20%) sales discount and exemption from Value-Added Tax (VAT) under Sections 32 and 33 of Republic Act (RA) No. 7277, as amended by RA No. 9442, otherwise known as the “Magna Carta for Persons with Disability” and RA No. 10754.
Toll fees of skyways and expressways which can be availed only by a PWD owning the vehicle mentioned under RR No. 1-2009 has been deleted. Moreover, the regulations mentioned discounts on public utility buses or jeepneys, taxis, Asian Utility Vehicles and shuttle services as additional land transportation privileges which can be claimed by qualified PWDs.
RR No. 5-2017 likewise added funeral and burial services for the death of the PWD as sales discount which may be claimed by the beneficiary or any person who shall shoulder the said expenses of the deceased.
Please refer to the full text of the RR for the guidelines of the tax privileges and incentives provided.
(RGM&Co. Note: The RR was published in Manila Bulletin on 22 April 2017).
BUREAU OF INTERNAL REVENUE
The Bureau of Internal Revenue (BIR) issued the following Revenue Memorandum Circulas (RMC):
RMC No. 30-2017, 12 April 2017, to inform all internal revenue officers and others concerned of the additional Personal Equity Retirement Account (PERA) Unit Investment Trust Funds (UITFs)/ investment products which were duly approved/ accredited by the Bangko Sentral ng Pilipinas.
The RMC also emphasized that only income earned from the investments and re-investments of PERA assets in the PERA investment products shall be exempt from income taxes under Rule 11 of the Rules and Regulations Implementing the PERA Act of 2008 and Section 9 of RR No. 17-2011. Likewise, income from investments and re-investments of PERA assets in government securities are exempt from income taxes under the said provisions.
RMC No. 31-2017, 12 April 2017, to inform all internal revenue officers and others concerned of the Advisory issued by the Microfinance NGO Regulatory Council. The Advisory provides that all Microfinance NGOs which were able to secure a Certificate of No Derogatory Information are advised to immediately coordinate with the Revenue District Offices where they are registered to update their registration using BIR Form 1905 and submit their Certificates of No Derogatory Information issued from 2016 to present.
RMC No. 35-2017, 27 April 2017, to clarify the imposition of the 6% capital gains tax (CGT) on sale, exchange or other disposition of real properties classified as capital assets pursuant to Sections 24(D)(1) and 27(D)(5) of the National Internal Revenue Code of 1997.
The items clarified by the said RMC include the following:
- The mere issuance of tax declaration without any sale, exchange, or disposition is not subject to CGT;
- There must be a transfer of ownership that resulted from sale, disposition or conveyance of real property;
- The payment of CGT is dependent and a direct consequence of the sale, transfer or exchange; and
- The profit or gain that was presumed to have been realized by the seller subjects the sale/transfer/exchange to the 6% CGT.