The Bureau of Internal Revenue (BIR) is bent on going after tax evaders and unregistered companies amid its recent crackdown on violators, all aimed to plug tax leakages and collect the proper revenue due government.
The government’s biggest revenue generating agency shuttered yesterday several unregistered warehouses in Bulacan, as well as restaurants that are said to cater mainly to Chinese employees of Philippine offshore gaming operators (POGOs), either for being unregistered or for not paying the correct amount of taxes.
The BIR is also exploring ways to properly tax online selling after it discovered that one of the unregistered warehouses in Bulacan contained assorted goods that were reportedly ordered through a popular online shopping app.
Arnel Guballa, BIR deputy commissioner, said on the sidelines of the BIR’s raid in Bulacan yesterday theDepartment of Finance (DOF) has instructed the tax agency to study ways on how to tax the digital economy.
“We have to tax the digital economy. We have to capture them, and make sure they pay the taxes. Anything can be ordered online, but there’s no receipt, and no taxes are paid to the BIR,” Guballa said.
“We have not yet estimated the tax leakages but (the amount) will be substantial. We’ve seen the market share of online selling, it’s huge so we’re starting to look at it,” he added.
Antonio Joselito Lambino, DOF assistant secretary, who was also present in the Bulacan raid, said the government is “exploring a few specific areas” in taxing the digital economy.
“It is a priority under the digital transformation of the BIR,” Lambino said.
The BIR padlocked 11 unregistered warehouses in Bulacan, six of which per preliminary assessment of the BIR, Lambino said, contained 410,000 50 kg sacks of rice.
One warehouse contained assorted goods for online selling, while the rest had various items like corn feeds, powdered milk, dishwashing soap, among others.
“We’re not sure if the items are smuggled or not, what we’re sure of is that the warehouses are not registered with the BIR,” Lambino said in a phone interview.
Five business establishments were identified with the unregistered warehouses. These are Cagayan Corn Products Corp.; Pacific Rim Transport & Logistics Inc., UPFC Logistics Corp.; AAI Logistics Cargo Express, Inc., and JComp Trading and Distribution.
The warehouses are located at T12 Commercial Complex, Ilang-Ilang St., Barangay Tabang, Guiguinto, Bulacan.
The BIR said that results of the investigation showed the five establishments located in the said complex were not compliant with the registration requirements of posting of the annual registration fee, payment form (0605), original certificate of registration and the poster
“Ask for Receipts” or Notice to the Public.”
Section 115(b) of the Tax Code, as implemented through Revenue Memorandum Order No. 03-2009, authorizes the BIR to suspend or close the business operations of a taxpayer for a period of not less than five days for failure to register; issue VAT official receipts or sales invoices; file correct VAT returns; or pay the correct VAT.
The closure order was signed by Guballa after the said establishments failed to comply with the registration requirements specified in Section 236 of the NIRC of 1997, as amended
“We have to close the warehouses because of non-registration with BIR, pursuant to Section 115 of the tax code. And then after the closing, we will (do an) inventory (of) all of these, to determine the value, and then we will also get the importation documents. If there are none, then these will be considered as smuggled,” Guballa said.
Meanwhile, the BIR also padlocked yesterday restaurants that are identified to cater mainly to Chinese employees of POGO firms.
BIR closed down “POGO restaurants” operated by Frame Rose Ranes Salisi (under tradename Young Restaurant) and Shinedeligo Corp., for failure to pay the correct VAT pursuant to Revenue Memorandum Order No. 3-2009, otherwise known as the Oplan Kandado Program.
Five other establishments whose business operations were temporarily suspended were not registered at all.
The seven closed establishments stemmed from the Tax Compliance Verification Drive targeting the nighttime businesses.
The BIR said the required 48-hour notice and five-day VAT compliance notice were duly served but remained unheeded. As such, closure orders were recommended.
“The establishments are said to be allied services to POGO operations since they predominantly serve the Chinese nationals employed by the latter,” the BIR said.