COVID-19 prompts another BIR extension: VAT refund claims until April 30

The Bureau of Internal Revenue (BIR) has also extended the deadline to apply for value-added tax (VAT) refunds as the ongoing community quarantine of the entire island of Luzon keeps people immobilized at home in the hope that the measure would stop COVID-19 dead on its tracks.

In an order issued by BIR chief Caesar R. Dulay last March 17, filing of VAT refund applications for the first quarter of 2018 would be accepted until April 30 instead of the March 31 deadline.

Dulay said amid the Luzon quarantine, the filing of VAT refund claims on March 31 had “become unviable.”

Evaluating the claims within the 90 days required by law has also become “unattainable,” Dulay said.

The counting of number of days that claims are processed would resume after President Rodrigo Duterte lifts his quarantine order.

The BIR had also extended the deadline for filing of income tax returns from April 15 to May 15 to heed appeals made by businesses, legislators, accountants and tax experts for a deadline extension because of the paralysis brought by the quarantine.

The deadline extension would delay collection of at least P145 billion in taxes, according to the Department of Finance (DOF) in a statement on Thursday.

The tax payments, the DOF said, “are crucial for the government to fund extremely urgent social protection and emergency health measures meant to effectively combat COVID-19.”

The collections were also needed to “sustain state investments needed to help Filipino families regain stable and reliable sources of income” as soon as possible.

The delayed taxes would be more than five times higher than the government’s initial P27.1-billion economic package for COVID-19 response.

Finance Secretary Carlos G. Dominguez III nonetheless said the tax-payment deadline extension would have “no impact” on the government’s plan to spend more on public goods and services this year, worth P4.2 trillion.

In a text message, Tax Management Association of the Philippines Inc. (TMAP) president Romeo H. Duran said the one-month deadline extension “will suffice.”

TMAP and four other groups of accountants and bankers had lobbied for the deadline extension. The DOF said it would “provide relief to Filipino taxpayers who will not be able to prepare, let alone file, the necessary ITR documents” before the original April 15 deadline.

This was so because of “skeletal workforce arrangements and enhanced community quarantine that the national government has implemented to contain the pandemic,” said the DOF.

Edited by TSB