Issue of July 15, 2018
Mt. Province

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Transport sector cries foul over ITR penalties

Members of the United Metro Baguio-Benguet Jeepney Federation of Baguio City and Benguet and Bureau of Internal Revenue OIC Regional Director Jonathan Jaminola attended last week’s city council session and discussed the schedule of payment and filing of income tax return for transport operators.

The transport groups earlier asked the city council to mediate on their appeal that the penalties on their income tax returns for transport business be waived by the BIR. Members of the transport group have been filing and paying their income tax annually, but the BIR has considered their filing late because the ITR must now be paid quarterly.

Pursuant to the National Internal Revenue Code (NIRC), as amended by the Tax Reform for Acceleration and Inclusion Law, the BIR regional office has notified the operator-members of the transport groups last June 8 to file their ITR on a quarterly basis and also pay penalties for the years 2016 and 2017 including the first quarter of 2018 as provided in Section 51 of the NIRC.

Jaminola said that under Revenue regulation 9-2007, operators of domestic common carriers and keepers of garage are also obliged to pay business tax or percentage tax computed from their minimum or quarterly gross receipts.

The penalty for late filing of tax information return, in lieu of a criminal case, is payment of compromise penalty depending on the amount of the tax unpaid. For example, one will have to pay P1,000 in case he has not paid the tax due, or depending on the unpaid tax but it should not exceed P5,000.

For the Baguio-Benguet operators, the penalty imposed from the original P3,000 per year was reduced to P1,500 per year, until Jaminola proposed a compromise wherein the penalty for 2016 will be waived, and operators would only have to pay penalties for 2017 and for the first quarter of 2018.

However, transport federation president Reynaldo Bacoco bargained that penalties for the previous two years be waived, as they were only notified last June 8 of the existence of the provision of the tax code on the quarterly payment. He asserted that they have been religiously filing their income taxes annually at the BIR but nobody called their attention about the new policy.

Referring to the statement of Jaminola that the federation members should be mindful of their obligations since they are presumed to know the existence of the law or the policy, which is in existence since 1997, recently amended by the TRAIN Law, Bacoco maintained that the BIR should still properly inform the public about the schedule of paying and filing tax returns. Having been informed of the quarterly policy for the first time, they are appealing to just pay the penalty for the first quarter of 2018.

The city council, which called the meeting of the parties in aid of legislation, encouraged the federation and the BIR representatives to attend the July 23 council session to give their final stand or agreement on the issue.

In Resolution 213, s. 2018, the body reiterated its requests to the Department of Public Works and Highways - Cordillera, the City Engineering Office, and the City Buildings and Architecture Office to coordinate their respective projects to concerned barangay officials before they implement the projects.

The action stemmed from the road widening projects at Marcos Highway and Legarda Road where electric posts were left standing within the roads and sidewalks; and the ongoing construction of flood control drainage from Baguio General Hospital to Melvin Jones football grounds that was not properly presented and consulted with the people in the affected area.

Another concern is the lack of proper warning signs and notices on the presence of holes and excavations along specific areas to prevent accidents.

The request is pursuant to the Local Government Code of 1991 that “no infrastructure or community project within the territorial jurisdiction of any local government unit shall be undertaken without informing the local chief executive and the sanggunian concerned.”

The law also mandates that all “all national agencies and offices to conduct periodic consultations with appropriate local government units, non-governmental and people’s organizations, and other concerned sectors of the community before any project or program is implemented in their respective jurisdictions.”

Compliance to the required periodic consultations and prior approval of the sanggunian concerned are required under the code before any project or program shall be implemented by government authorities.

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