Court of Tax Appeals rulings favor Waterfront, PALBy Ronnel W. Domingo
Philippine Daily Inquirer
The Court of Tax Appeals foiled the taxman’s pursuit of arrears from Waterfront Cebu City Hotel and Casino, ruling that the company even exceeded its dues.
In a decision issued on Dec. 20, the CTA canceled the Bureau of Internal Revenue’s assessment that Waterfront Cebu had an income tax deficiency of P2.6 million in 2006, excluding surcharges and interest.
In reviewing the BIR’s assessment, upon Waterfront Cebu’s petition, the CTA also found that the company had actually overpaid P7.8 million.
According to the BIR, the arrears stem from a discrepancy in excess tax credits that Waterfront Cebu claims for 2005. The company supposedly claimed P1.5 million more than it was entitled to.
Aside from that, the BIR disallowed about P213,000 in tax withheld.
With an interest of some P860,000 for Waterfront Cebu’s alleged deficiency for 2006 alone, the BIR wanted the company to pay about P2.6 million.
The CTA noted that in reconciling Waterfront Cebu’s tax records from 2005 to 2011, it found out that the company had tax credits amounting to P7.8 million.
In a separate decision also dated Dec. 20, the CTA ordered the BIR to credit some P1.5 million in excise tax on imported “sin products” that Philippine Airlines overpaid.
The CTA said PAL proved that it “erroneously paid” the amount within a five-week period covering June to July in 2007.
However, the decision meant a partial victory for the airline because its petition filed before the court was for a credit of P10.9 million.
The case stemmed from a February 2005 request from the BIR to the Bureau of Customs, to collect excise tax on all imports destined for Duty Free Philippines and Freeport zones as provided for in the Sin Tax Law of 2004.
Short URL: http://business.inquirer.net/?p=103713