Apply new tax rates, firms told

The Bureau of Internal Revenue yesterday told employers to implement the lower personal income tax rates that went into effect at the start of the year even as the country’s biggest tax-collection agency had yet to come out with the implementing guidelines of the first tax reform package.

The BIR is set to issue at least nine revenue regulations (RRs) to implement Republic Act No. 10963 or the Tax Reform for Acceleration and Inclusion (TRAIN) Act, which starting Jan. 1 slashed and restructured personal income tax rates while jacking up or slapping new taxes on consumption of oil, cigarettes, sugary drinks and vehicles, revenue attorney Euvimil Nina Asuncion said.

Internal Revenue Commissioner Caesar R. Dulay told reporters that the RRs would be released within the month.

“Penalties should be in order” for those that would not comply with revenue memorandum circular No. 105-2017. Dulay said this in reaction to reports that a number of employers were not yet implementing the revised tax rates pending the issuance of the RR.

On Dec. 28, Dulay issued RMC 105-2017, which revised the withholding tax table on compensation in the tax code to reflect the changes under the TRAIN.

“We have published the RMC, they [employers] should have checked that, so they know the rates. So they should be ready,” he said.

BIR Assistant Commissioner Marissa O. Cabreros said the RMC would ensure the taxes employers withhold from their employees were correct.

Dulay enjoined employees to report to the BIR employers that were not implementing the new income tax rates.

“They can go to my office and tell me who are their employers and we will call their attention. The employers will not know who called our attention,” he said.

In the meantime, Asuncion said that besides the four draft RRs that would undergo public consultation, the BIR had also submitted a number of proposed RRs to the Department of Finance for approval.

The BIR yesterday presented the draft RRs on income tax as well as on the excise tax on sweetened beverages.

Public consultations will be held on Friday for the proposed RRs on value-added tax and excise tax on cosmetic procedures.

Asuncion said the draft RRs on automobile excise tax, petroleum excise tax, tobacco excise tax and documentary stamp tax were now with the DOF.

RRs on the donor’s and estate taxes will also be released within the month, Asuncion added.