EDITORIAL
Paying taxes made easier
Perhaps one of the most significant legislations that greeted
the taxpaying public with ‘Happy New Year’ is the Ease of Paying
Taxes Act (the EOPT Act or Republic Act No. 11976).
In an effort to plug all the loopholes in taxation, there was
one point in the history of Philippine taxation that an income tax
return consisted of 12 pages with all required disclosures, which
an ordinary taxpayer does not have any idea about at all. In
many instances, a micro or small taxpayer needs only to fill in two
pages of the return, leaving the other 10 pages blank.
Congress might have noticed the excessive use of paper
such that it was forced to legislate under the TRAIN Law that the
income tax return shall consist of a maximum of four pages and
contain only five classes of information. Hence, it has put a stop
to the practice of the Bureau of Internal Revenue to make things
difficult for the taxpayers and cause the latter to shell out more
money for fines and penalties.
Under the EOPT Act, the annual registration fee requirement
of P500.00 has been removed. Taxpayers are now classified into
micro, small, medium, and large, with special concessions for
micro and small taxpayers (i.e., a maximum of two pages for
income tax returns; reduced penalties).
Filing of returns and payment of internal revenue taxes will
also be made easier through electronic or manual means such as
authorized agent banks or authorized software providers.
In the past, many taxpayers were penalized for issuing the
wrong invoice or receipt for the sale of goods or services. This is
no longer a problem as the law also harmonizes the rules on the
value-added tax (VAT) treatment of sales of goods and services,
thereby requiring sales invoice for both.
The mandatory issuance of receipts for each sale and
transfer of goods and services will be increased from PHP 100 to
PHP 500.
The BIR is now mandated to promote and assist taxpayers
by streamlining tax processes, reducing documentary
requirements, and digitalizing its services.
The implementing rules and regulations (IRR) must be
issued within 90 days from the effectivity of the EOPT Act. In the
past, the IRR has made the Tax Code more challenging to comply
with by requiring a long list of documents to be submitted to the
Bureau.
With the letter and intent of the law too clear to be
misconstrued, it is expected that the upcoming IRR must make
things simple and straightforward. Otherwise, it defeats the very
purpose of the law – to make paying taxes easier.