It didn’t take long for Commissioner Kim Henares of the Bureau of Internal Revenue to recover her footing after one of her key tax policies suffered a crippling blow at the hands of the Supreme Court.
Just a few days after the country’s financial services industry won an important battle with the help of the high tribunal, the country’s top tax(wo)man is set to unveil what will surely be an equally controversial ruling.
According to our source, Henares is set to sign any time now a new memorandum that will compel financial institutions to identify which of their clients (unnamed, as far as the BIR is concerned) they are withholding taxes for.
Under the new scheme, BIR will no longer accept at face value the declaration of financial institutions (like stockbrokers and banks) that the investment income of client so-and-so has already been subjected to final withholding tax unless the company can identify specifically who paid what.
In the past, of course, financial institutions levied withholding taxes on clients’ investment income and remitted these to the BIR in lump sum form (especially for investments lodged under the generically named “nominee accounts” of the Philippine Central Depository).
“How do we know that these investors are really paying the right amount of taxes if you won’t tell us who they are,” said one source, quoting Henares. “If you say they’ve already paid the right taxes, we want to know who they are. Otherwise, these [investment proceeds] will still be subject to tax.”
As such, the new policy effectively shifts the nature of the fight from one between the BIR and the financial institutions to one between the financial institution and their clients.
(Tax authorities are clearly hoping that, faced with a potential revolt by clients whose investment incomes end up being taxed twice, financial institutions will relent to revealing their identities.)
With round one having been won by the coalition led by the Philippine Stock Exchange and the Bankers Association of the Philippines, expect a more action-packed round two with the BIR. Daxim L. Lucas
Football atop MOA
Imagine playing football, or even watching a heart-stopping game, on a vast field overlooking the Manila Bay panorama.
Such a football field is precisely what local property giant SM Prime Holdings plans to build right on top of the sprawling Mall of Asia shopping mall, and open it to the public around 2017.
The SM group earlier announced plans to add only one new floor to expand leasable space in the currently two-level MOA. But instead of just adding just one story to accommodate more merchants, the group must have had some epiphany of sorts: After making space for ice skating in its mall, why not do the same for football? After all, the popularity of this sport in the country has zoomed in recent years, thanks to the hunks of national team Azkals.
Asked for updates on the renovation of MOA, SM Supermalls premier division vice president Steven Tan told Biz Buzz that the SM group was now starting the construction of another parking floor.
“Next year, we will start the third level of MOA and on top of the third floor, we’ll have a football field,” Tan said, “because we see increasing interest in that field. You know, we try to see what will happen in the future.”
The football field will thus be on the fourth level of MOA, whose expansion will restore its position as the country’s biggest mall in terms of leasable space. (In the meantime, Megamall has grabbed this distinction with the opening of premium wing Mega Fashion Hall).
As the expansion will increase retail space by at least a third, MOA will end up with about 530,000 square meters of retail area, surpassing Megamall’s 490,000 sqms in the next few years.
The expansion of MOA will be accompanied by some changes in the tenant mix and layout. For instance, the ice skating rink will be transferred from the ground floor to a higher floor, thereby freeing up premium ground floor space for retailers.
It is of course the first time—at least in this part of the world—that a football field will be incorporated in a shopping mall blueprint. But then, it’s not surprising for the country’s largest conglomerate whose reverberating anthem says: “We’ve got it all for you.” Doris C. Dumlao
SM’s 50th
Speaking of SM Prime, it will soon have as many shopping malls in the Philippines as there are states making up the United States.
The 50th local shopping mall will open this year in Angono, Rizal. SM Supermalls’ Steven Tan said there wasn’t any deliberate move to pick Angono—deemed the “Arts Capital of the Philippines”—as the site for the 50th milestone. It just so happened that this would be the 50th mall ready for the next ribbon-cutting.
Based on the announcement when the Angono mall broke ground, the three-story mall at the gateway of the town between Manila East Road and Quezon Avenue will have 33,094 sqm of retail area. It will also be the third in the province of Rizal, after SM City Taytay and SM City Masinag in Antipolo.
The 50-mall network, for course, does not include SM Prime’s shopping malls in China, where it is building at least one new mall a year. The group has five hubs in China operational so far—Xiamen, Jinjiang (“Tatang” Henry Sy’s hometowm), Chengdu, Suzhou and Chongquing. Doris C. Dumlao
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