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Court of tax appeals grants P29-M tax refund to San Miguel Corp.

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Court of tax appeals grants P29-M tax refund to San Miguel Corp.

/ 12:34 AM May 08, 2017
Court of Tax Appeals. PHOTO FROM cta.judiciary.gov.ph

Court of Tax Appeals. PHOTO FROM cta.judiciary.gov.ph

The Court of Tax Appeals has ordered the government to refund conglomerate San Miguel Corp. the P28.88 million it paid for interest and surcharges on documentary stamp taxes.

The documentary stamp taxes were imposed on cash advances that San Miguel extended to its affiliates in 2010.

But since the Bureau of Internal Revenue ruled in 2008 that such advances are not subject to documentary stamp taxes, the court said “good faith” justified the removal of interest and surcharges.

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“The settled rule is that good faith and honest belief that one is not subject to tax on the basis of previous interpretation of government agencies tasked to implement the tax laws are sufficient justification to delete the imposition of surcharges and interest,” the decision read.

However, the court upheld the tax agency’s position that San Miguel was still liable for P41.89 million in taxes for the cash advances themselves.

The conglomerate disputed the tax liability because the cash advances were done in 2010, even before the Supreme Court decided in 2011 that such advances are taxable.

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TAGS: Business, Court of Tax Appeals, Philippine news updates, San Miguel Corp., tax refund
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