PEZA Memorandum Circular (MC) No. 2026-022, issued on March 30, 2026, circularizes Fiscal Incentives Review Board (FIRB) Advisory No. 004-2026, which provides clarificatory guidelines on the submission of the Annual Tax Incentives Report (ATIR) and Annual Benefits Report (ABR) pursuant to Republic Act (R.A.) No. 12066 or the CREATE MORE Act. Specifically, the circular clarifies that only Registered Business Enterprises (RBEs) which availed of tax incentives during a taxable year are required to submit the ATIR and ABR within thirty (30) calendar days from the statutory deadline for filing tax returns and paying taxes, while RBEs that did not avail of any incentives are no longer required to submit. Also, the submission must be done through the FIRB‑prescribed Electronic ATIR and ABR data entry system via the Fiscal Incentives Registrations and Monitoring System (FIRMS) platform, as manual submissions will not be accepted. The advisory applies retroactively from the effectivity of the CREATE Act on April 11, 2021, takes immediate effect, and supersedes specific provisions of previous FIRB guidance. | | [AUTHORITY TO CONTRACT OR GUARANTEE FOREIGN LOANS VESTS WITH THE PRESIDENT, WITH THE PRIOR CONCURRENCE OF THE MONETARY BOARD & SUBJECT TO LEGAL LIMITATIONS] [AUTHORITY OF AN LGU TO OBTAIN LOANS IS LIMITED & APPLICABLE ONLY WHEN THE FINANCING SOURCES - APART FROM GOVERNMENT BANKS & FINANCIAL INSTITUTIONS - ARE DOMESTIC OR LOCAL IN NATURE] Bangko Sentral ng Pilipinas (BSP) is requesting confirmation of the validity of Executive Order (E.O.) No. 809, otherwise known as the Financing Policy Framework for Local Government Units (LGUs), as the legal basis for first-tier LGUs to directly contract loans or foreign obligations, including Multilateral Financial Institutions (MFIs), and to clarify whether direct lending to sub-national entities is allowed and if there are any restrictions on the implementation of E.O. No. 809. In reply, it is clarified that the Department of Justice (DOJ)’s unnumbered opinion dated September 8, 2009, did not categorically affirm that E.O. No. 809 serves as legal authority for LGUs to directly borrow from MFIs, as the DOJ does not rule on the validity of presidential issuances, which are presumed valid. Existing constitutional and statutory provisions clearly vest the authority to contract foreign loans in the President, with the concurrence of the Monetary Board, and subject to such limitations as may be provided by law. Consistent with this, executive issuances cannot amend or extend the law. Jurisprudence and prior DOJ opinions further establish that while LGUs have authority to incur indebtedness under the Local Government Code (LGC), such authority is limited to domestic sources, and foreign loans must be secured by the President or his duly authorized representative for relending to LGUs. Therefore, the DOJ is constrained not to reconfirm its unnumbered Opinion recognizing E.O. No. 809 as a borrowing authority for LGUs to directly contract foreign loans with MFIs. [DEPARTMENT OF JUSTICE LEGAL OPINION NO. 9, SERIES OF 2026, MARCH 30, 2026]
[HOA ELECTIONS ORDERED BY HSAC MUST BE CARRIED OUT BY DHSUD REGIONAL OFFICES, NOT LGUS] [HSAC’S SHERIFFS ENFORCE WRITS, BUT THE DHSUD EXECUTES THE ELECTIONS] The Human Settlements Adjudication Commission (HSAC) is requesting a legal opinion on whether it may deputize Local Government Units (LGUs) as special sheriffs to conduct elections of Homeowners’ Associations (HOAs) pursuant to its orders or decisions. In reply, while Section 19 of Republic Act (R.A.) No. 11201 or the “Department of Human Settlements and Urban Development (DHSUD) Act” authorizes HSAC to appoint or designate sheriffs to execute its final decisions and orders, the actual authority to call for, conduct, supervise, and observe HOA elections is expressly vested in the DHSUD through its Regional Offices, consistent with DHSUD’s regulatory mandate over HOAs. The execution of HSAC decisions requiring HOA elections should therefore be carried out by serving such orders upon the DHSUD Regional Offices, which will conduct the elections pursuant to established guidelines. LGUs cannot be treated as government “instrumentalities” subject to deputization by HSAC, as they are political subdivisions with constitutionally guaranteed local autonomy; absent an explicit legislative mandate, deputizing LGUs would constitute an impermissible expansion of HSAC’s powers and an intrusion into local autonomy. [DEPARTMENT OF JUSTICE LEGAL OPINION NO. 08, SERIES OF 2026, MARCH 30, 2026] | | [STRICT COMPLIANCE WITH DOCUMENTARY REQUIREMENTS IS NECESSARY TO ESTABLISH ZERO-RATED SALES & ENTITLEMENT TO INPUT VAT REFUND] [FAILURE TO PROVE EXPORT SALES WITH VALID INVOICES, BILLS OF LADING & REMITTANCES RESULTS IN DENIAL OF REFUND CLAIM] Petitioner Agri Exim Global Philippines, Inc. filed a Petition for seeking reversal of the CTA Third Division’s Decision and Resolution, which denied its claim for refund representing unutilized input Value-Added Tax (VAT) attributable to alleged zero-rated export sales for taxable year 2019. The Petitioner argued that it had complied with the requisites under Section 112(A) of the Tax Code and that discrepancies in inward remittances should not negate its entitlement to refund, as these could be explained by advance payments, prior period receivables, or foreign exchange fluctuations. On the other hand, the Respondent Commissioner of Internal Revenue (CIR) countered that the Petitioner failed to establish compliance with the conditions for zero-rating under Section 106(A)(2)(a)(1) of the Tax Code. In ruling, the Court AFFIRMED the denial of the refund explaining that the Petitioner failed to prove the existence of zero-rated export sales. Several sales invoices were not valid VAT zero-rated invoices, some export sales lacked supporting bills of lading and export declarations, and certain bills of lading were either denied admission or illegible. Moreover, inward remittance certifications did not match the sales invoices, and the Petitioner failed to present reconciliation schedules or documentary proof to justify the discrepancies. Without valid invoices prominently indicating “zero-rated sale,” export declarations, bills of lading, and proof of inward remittances in acceptable foreign currency duly accounted for under Bangko Sentral ng Pilipinas (BSP) rules, entitlement to refund cannot be established. [AGRI EXIM GLOBAL PHILIPPINES, INC. VS. COMMISSIONER OF INTERNAL REVENUE, CTA EN BANC CASE NO. 3075, MARCH 24, 2026] AN ASSESSMENT NOTICE MUST BE PROPERLY RECEIVED TO BE VALID; INVALID SERVICE VIOLATES DUE PROCESS & RENDERS THE ASSESSMENT VOID Petitioner Zoom Celero Courier, Inc. filed a Petition for Review seeking to nullify the 2017 deficiency assessment issued by the Respondent Commissioner of Internal Revenue (CIR). The Petitioner argues that it never properly received the Preliminary Assessment Notice (PAN) and Formal Letter of Demand/Final Assessment Notice (FLD/FAN), thereby violating its right to due process and rendering the assessments void. On the other hand, the Respondent counters that the PAN and FLD/FAN were properly served via registered mail, and absent a valid administrative protest, the assessments became final and demandable, authorizing it to proceed with collection. In ruling, the Court held that the Respondent failed to prove valid service of the PAN and FLD/FAN, as the testimonies and registry receipts offered were hearsay and lacked probative value. Moreover, the FANs did not contain due dates for payment, contrary to jurisprudence requiring assessments to state a definite demand. Consequently, the assessment was declared VOID. [ZOOM CELERO COURIER, INC. VS. COMMISSIONER OF INTERNAL REVENUE, CTA CASE NO. 10660, MARCH 19, 2026] [IF REVENUE GENERATION IS THE PRIMARY PURPOSE & REGULATION IS MERELY INCIDENTAL, THE IMPOSITION IS A TAX; BUT IF REGULATION IS THE PRIMARY PURPOSE, THE FACT THAT INCIDENTAL REVENUE IS ALSO OBTAINED DOES NOT MAKE THE IMPOSITION A TAX] Petitioner Dole Philippines, Inc.- Stanfilco Division filed a Petition for Review seeking to overturn the Decision and Order promulgated by the Regional Trial Court (RTC) of Davao City, which denied the Petitioner’s payment under protest. The Petitioner prayed to nullify the ordinance of the Respondent Sangguniang Panlungsod of Davao City, specifically the Davao City Watershed Code, for failure to comply with the procedural requirements under the Local Government Code (LGC), declare the Environmental Tax illegal, cancel the assessment, obtain a refund, and stop further impositions. Petitioner argued that the Respondent is barred from changing the theory on appeal and that the Court has plenary jurisdiction over the local treasurer’s actions. Likewise, the Watershed Code is ultra vires and void, that the Environmental Tax is a tax ordinance and not a regulatory fee, that the RTC erred in upholding it, and that the assessment is unreasonable or excessive, even if treated as a regulatory fee. On the other hand, the Respondents maintained that the Environmental Tax is a regulatory measure, not a tax, and thus validly imposed to implement the Watershed Code. Also, the ordinance complied with LGC requirements, is not ultra vires, that the refund claim is an improper collateral attack, and that LGUs are authorized to manage watersheds. Further, the classification, imposition, and computation of the charge are valid, reasonable, and not excessive. In ruling, the Court held that the nature of an imposition depends on its purpose. If the purpose is primarily for revenue, the imposition is a tax, but if regulation is the primary purpose, the imposition is properly categorized as a regulatory fee. Applying this, the Environmental Tax under Section 17 of Davao City Ordinance No. 0310-07, or the Watershed Code, is a regulatory fee intended to protect, conserve, and manage the watershed, with revenue being merely incidental. Thus, it is not a local tax within the Court’s appellate jurisdiction. Since jurisdiction is conferred by law and cannot be waived, the Court has no authority to entertain the appeal and must dismiss the case. Thus, the Petition was DISMISSED. [DOLE PHILIPPINES, INC. - STANFILCO DIVISION VS. THE SANGGUNIANG PANLUNGSOD OF THE CITY OF DAVAO & THE HON. SARA Z. DUTERTE CARPIO & HON. LAWRENCE D. BANTIDING, IN THEIR RESPECTIVE CAPACITIES AS MAYOR & ACTING TREASURER OF THE CITY OF DAVAO, CTA AC NO. 325, MARCH 11, 2026] DIVIDEND INCOME OF FINANCING INSTITUTIONS OWNED & CONTROLLED BY FOREIGN GOVERNMENTS IS EXEMPT FROM TAX SUBJECT TO PROOF OF OWNERSHIP Petitioner SN Power Invest Netherlands, B.V. filed a Petition for Review seeking a refund of erroneously paid Final Withholding Taxes (FWTs) on dividends. The Petitioner argued that it is entitled to a refund of the FWTs on the dividends, as these are exempt from such tax. Likewise, the dividends constitute income derived from investments in the Philippines of a financial institution owned and controlled by a foreign government at the time of declaration; hence, the FWTs were erroneously or illegally remitted. On the other hand, Respondent Commissioner of Internal Revenue (CIR) countered that a refund may be granted only upon proof of erroneous or illegal collection of tax, which the Petitioner failed to establish. The latter did not comply with the requirements for the admissibility of foreign public documents, thereby rendering its documentary evidence insufficient to prove entitlement to the claimed exemption. In ruling, the Court held that both the administrative and judicial claims were timely filed within the two-year prescriptive period from the remittance of the FWTs. Moreover, the dividends received by the Petitioner, being income derived from investments in the Philippines, and with the Petitioner, as wholly owned by a foreign government, fall squarely within the tax exemption under Section 32(B)(7)(a) of the Tax Code. Proof of ownership by the foreign government was sufficiently established, satisfying the essential requirement for exemption. Therefore, the Petition was GRANTED, ordering the Respondent to REFUND the Petitioner. [SN POWER INVEST NETHERLANDS, B.V. VS. COMMISSIONER OF INTERNAL REVENUE, CTA CASE NO. 10710, 10878, 11065, FEBRUARY 26, 2026] | |
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