DEPARTMENT OF FINANCE
The Bureau of Internal Revenue (BIR) issued the following:
Revenue Memorandum Circular (RMC) No. 56-2018, 25 June 2018, to circularize the full text of Republic Act (RA) No. 11032, otherwise known as the “Ease of Doing Business and Efficient Government Service Delivery Act of 2018”.
RA No. 11032 applies to all government offices and agencies including Local Government Units (LGUs), government-owned or -controlled corporations (GOCCs) and other government instrumentalities, whether located in the Philippines or abroad, that provide services covering business and non-business related transactions.
The salient provisions of RA No. 11032 are as follows:
RA No. 11032 shall take effect within fifteen (15) days following its publication in the Official Gazette or in two (2) national newspapers of general circulation.
(RGM&Co. Note: The RA was published in Manila Bulletin and Business Mirror on 2 June 2018).
RMC No. 46-2018, 21 May 2018, to clarify Section 214 of the National Internal Revenue Code of 1997, as amended, pursuant to an excerpt of the ruling by the Commissioner of Internal Revenue (CIR) dated March 13, 2018 which provides that for redemption of property sold to be valid, all public taxes including interest and penalties must be paid. Otherwise stated, failure by the delinquent taxpayer or any one of him to pay all public taxes including interest and penalties would make the redemption invalid.
Revenue Memorandum Order (RMO) No. 26-2018, 24 May 2018, to amend provisions of RMO No. 47-2004 and Operations Memorandum No. 3-2014 in relation to guidelines in the monitoring, identification, inclusion, and deletion of taxpayers who are mandated to withhold the expanded withholding tax (EWT) from their income payments equivalent to one percent (1%) on goods and two percent (2%) on services. Such taxpayers are now identified as Top Withholding Agents (TWAs).
The TWAs shall include the following:
a. Existing top taxpayers who/which were duly notified by the CIR as any of the following unless previously de-classified as such or had already ceased business operations:
i. A large taxpayer under Revenue Regulations (RR) No. 1-98, as amended;
ii. Top twenty thousand (20,00) private corporations under RR No. 6-2009; or
iii. Top five thousand (5,000) individual taxpayers under RR No. 6-2009;
b. Taxpayers newly identified and included as Medium Taxpayers, and those under the Taxpayer Account Management Program (TAMP).
Concerned Revenue District Offices (RDOs), through their concerned Regional Directors, shall submit to the Assistant Commissioner of Internal Revenue (ACIR) on a semestral basis (i.e. not later than every April 30 and October 31) a list of taxpayers recommended for inclusion as TWAs and/or list of TWAs for deletion, if any. The ACIR, Large Taxpayer Service (LTS) shall likewise submit the same list, in case of inclusion/deletion of large taxpayers under their jurisdiction. The Chief, Miscellaneous Operations Monitoring Division (MOMD) shall then consolidate and evaluate the lists and submit the same to the ACIR, Collection Service, not later than every May 31 and November 31 of each calendar year, for approval by the CIR.
The ACIR, Collection Service, thru the Chief, MOMD, shall be responsible for the publication in a newspaper of general circulation, posting in the BIR website, and issuance of a RMC of the CIR-approved list of TWAs and regular semestral list of TWAs for inclusion or deletion no later than every June 15 and December 15 of each calendar year.
Pursuant to RR No. 11-2018, the publication of the CIR-approved list is sufficient notice to concerned TWAs. However, concerned RDOs may prepare and personally serve individual written notices of inclusion/deletion to affected taxpayers under their jurisdiction. The obligation of concerned TWAs to withhold the 1% and 2% EWT on goods and services, respectively shall commence on the 1st day of the month following the month of publication.
For purposes of publication, only the complete names of the TWAs and their respective RDO/LTS office where they are registered shall be indicated. However, the MOMD shall maintain a master list of TWAs containing additional information (i.e. address, taxpayer identification number, date of publication, name of newspaper/publisher, and remarks.)
For calendar year 2018, the semestral lists shall be submitted by concerned revenue offices to the ACIR, Collection Service, on or before 30 June 2018 while the Chief, MOMD shall submit to the ACIR, Collection Service, the lists of TWAs for subsequent approval by the CIR on or before 31 August 2018.
Attached are the copies of the issuances for your reference.
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