Controversial ITR disclosure stays, BIR insists

THE BUREAU of Internal Revenue will stand firm on revised income tax return forms as spelled out in a memorandum issued last September, Commissioner Kim S. Henares said on Thursday.

Henares said in an interview there will be no withdrawing of Revenue Memorandum Circular No. 40-2011, despite pressures from lawmakers.

She clarified that these new forms—No. 1700, 1701 and 1702—are merely new versions of old ITR forms.

ITR form No. 1700 is for taxpayers who earn purely from compensation, No. 1701 is for the self-employed, and as well as estates and trusts, and No. 1702 is for non-individuals like corporations and partnerships.

“The revision is meant to make the documents OCR ready [machine readable using optical character recognition] which will enable direct uploading to our database without the need for human intervention, such as those of encoders,” Henares explained.

The BIR chief added that another reason for adopting a new version of the forms is to help the agency to check the veracity of reports about alleged tax cheats.

“With the information that taxpayers submit to us through these ITR forms, it will be possible to explain these reportedly unexplained wealth without having to conduct investigations that use up our resources,” she said.

“If the taxpayer does not fill out the relevant items [in the forms], we will assume that the taxpayer has no such income,” she added.

Henares denied that these new forms require taxpayers to divulge information about their bank accounts, contrary to laws on banking secrecy.

“We only ask for information about interest income (earned from the deposits) and the tax withheld,” she said.

The Committee of Ways and Means at the House of Representatives has reportedly subpoenaed Henares for supposedly not attending hearings the past three weeks and explain the memorandum.

“I have no problem about attending Congressional hearings,” Henares said. “I was there last week [and] I sat there for two and a half hours.”

“What more could they want from me?” she said. “If they ask me whether I would withdraw this RMC, I say ‘no.’”

Further, the BIR chief has issued RMC No. 57-2011, which clarifies that filing of these new-version forms is optional for tax year 2011, the deadline for which is in April 2012.

“As mentioned in RMC No. 40-2011, filing is required tax year 2012 (the deadline for which is in April 2013),” Henares said.