Subject: WEEKLY TAX UPDATES [JULY 24] Carla Abellana calls out alleged tax corruption in the Philippines

WEEKLY TAX UPDATES

JULY 24

  1. TAX & BUSINESS-RELATED NEWS [JULY 16-23]

  2. SUPREME COURT RECALLS EARLIER COMPLIANCE OF ALL NOTARIES PUBLIC ON THE PAYMENT & AFFIXTURE OF LOOSE DOCUMENTARY STAMPS PRIOR TO NOTARIZATION

  3. BIR PRESCRIBES NEW FORMATS FOR VAT ZERO-RATING CERTIFICATES UNDER THE CREATE MORE ACT

  4. BIR ITAD RULING ON MOST-FAVORED NATION CLAUSE

  5. SEC LEGAL OPINION ON FOREIGNERS IN THE BOARD OF A CONDOMINIUM CORPORATION

  6. CTA CASE DIGEST

1. TAX & BUSINESS-RELATED NEWS [JULY 16-23]

1. TIEZA books P192-million investment commitments as of July

2. US healthcare firm eyes up to $500-M investment for PH tertiary hospital

3. SC fines disbarred lawyer for violating rules on notarial practice

4. DOF: CMEPA to encourage Filipinos to diversify portfolios

5. Ombudsman suspends GSIS head, 6 others

6. SC upholds Romero’s 131-hectare Mandaue reclamation project

7. US tax to cut PHL remittance growth

8. SEC warns vs 'tasking and recharging' job offer scams

9. First Philippine Industrial Park shifts 21 facilities to renewable power under RAP

10. BoC extends validity of importer accreditations to three years

11. Raffy Tulfo pushes for travel tax exemption for Filipinos flying economy

12. Tax on savings interest sparks renewed call to tax billionaires instead

13. P50 wage increase for NCR takes effect

14. Zuckerberg settles lawsuit over Cambridge Analytica scandal

15. Lacson wants 1% of VAT collections for LGU dev’t projects

16. PHINMA boosts property arm with P300-M capital for Saludad project

17. Tighter rules and taxes, not online gambling ban

18. Ex-BIR exec to serve year in prison after Sandigan denies bail, appeal

19. SSS acquires 740-M Century Properties shares

20. Carla Abellana calls out alleged tax corruption in the Philippines

21. Did Your School Make It? 80+ Philippine Universities Ranked Among World’s Most Innovative in WURI 2025

22. SteelAsia gets ‘green lane’ status for Candelaria project

23. Marcos OKs private sector help to run North-South Commuter Railway

24. Tourism MSMEs offered SBCorp. loan package

DISCLAIMER!

We saw these tax and business-related news on various news sites, and we thought you should see them. DMD is not responsible for the content of these news, and anything written thereon does not necessarily reflect DMD views or opinions.

TIEZA books P192-million investment commitments as of July [BusinessWorld, July 23, 2025]

On Monday, TIEZA welcomed seven registered business enterprises to its portfolio. These are Bukid Amara Davao, Fairfield by Marriott Cebu Mactan, Anjo World Conference Center, Avignon Clinic, Flow State Bouldering, Belo Medical Group – Greenhills, and Reside Siargao.

 

US healthcare firm eyes up to $500-M investment for PH tertiary hospital [GMA News Online, July 23, 2025]

American healthcare firm Bon Secours Mercy Health (BSMH) has expressed its intent to expand its existing Global Business Services (GBS) operations in the Philippines and invest up to $500 million to develop a premium, state-of-the-art tertiary hospital.

 

SC fines disbarred lawyer for violating rules on notarial practice [Philippine News Agency, July 22, 2025]

The Supreme Court has fined a disbarred lawyer for notarizing an agreement between siblings who passed away years before the actual signing of the document.

 

DOF: CMEPA to encourage Filipinos to diversify portfolios [Philippine Daily Inquirer, July 22, 2025]

The move is part of the government’s broader effort to deepen the local capital market and reduce the country’s heavy dependence on banks.

 

Ombudsman suspends GSIS head, 6 others [The Manila Times, July 22, 2025]

THE Office of the Ombudsman has issued a preventive suspension order against Government Service Insurance System (GSIS) President and General Manager Jose Arnulfo "Wick" Veloso and six others for involvement in the purchase of P1.45 billion in preferred shares from Alternergy Holdings Corp. without the approval of the GSIS board.

 

SC upholds Romero’s 131-hectare Mandaue reclamation project [Inquirer.Net, July 22, 2025]

In a landmark decision, the Supreme Court has upheld the legality and enforceability of a joint venture agreement (JVA) between former representative Michael “Mikee” Romero’s GlobalCity Mandaue Corporation (GMC) and the city government of Mandaue, clearing the way for the long-delayed 131-hectare reclamation and urban development project in Cebu.

 

US tax to cut PHL remittance growth [BusinessWorld, July 21, 2025]

US President Donald J. Trump’s recently passed “One Big Beautiful Bill” imposes a 1% excise tax on cash remittance transfers from the United States to other countries, starting Jan. 1, 2026. This was lower than earlier proposals of a 3.5% levy.

 

SEC warns vs 'tasking and recharging' job offer scams [ABS-CBN News, July 21, 2025]

According to the SEC, the scammers reach out to their victims through messaging apps like Messenger, Viber, and Telegram, where they offer menial tasks like ordering or purchasing items and sorting, allegedly for an e-commerce platform.

 

But the users are then required to deposit minimal amounts to access a dubious e-commerce platform that assigns the paid tasks. The victims deposit more money in higher amounts to get higher-paying tasks.

 

First Philippine Industrial Park shifts 21 facilities to renewable power under RAP [BusinessWorld, July 22, 2025]

Lopez-led economic zone (ecozone) developer First Philippine Industrial Park (FPIP) has joined the government’s Retail Aggregation Program (RAP) by tapping into the renewable energy (RE) supply from its sister firm, First Gen Corp.

 

BoC extends validity of importer accreditations to three years [BusinessWorld, July 21, 2025]

The goal is also to reduce the administrative burden on importers and to simplify the process, allowing them to focus more on their operations rather than annual renewals.

 

Raffy Tulfo pushes for travel tax exemption for Filipinos flying economy [Inquirer.Net, July 21, 2025]

“The measure merely introduces a more equitable structure by retaining the imposition of travel tax on passengers traveling via business class or higher, whose financial standing affords them greater capacity to contribute to national development,” Tulfo said in his proposed measure’s explanatory note.

 

Tax on savings interest sparks renewed call to tax billionaires instead [ABS-CBN News, July 20, 2025]

The controversial Capital Markets Efficiency Promotion Act (CMEPA) "punishes" working and middle-class Filipinos, ACT Teachers party-list said Sunday, as it renewed the call for a wealth tax on billionaires.

 

P50 wage increase for NCR takes effect [The Manila Times, July 19, 2025]

The order raises the daily minimum wage to P695 for nonagricultural workers and P658 for those in agriculture, retail and small manufacturing sectors. The NCR wage board said that this is the largest wage hike it has approved to date.

 

Zuckerberg settles lawsuit over Cambridge Analytica scandal [ABS-CBN News, July 18, 2025]

Cambridge Analytica was a political consulting firm that was found to have improperly accessed personal data from millions of Facebook users for targeted political advertising, particularly during the 2016 US election and Brexit referendum.

 

Lacson wants 1% of VAT collections for LGU dev’t projects [Philippine News Agency, July 18, 2025]

“This bill intends to incentivize local government units that consistently achieve their revenue collection targets and substantially contribute to the national coffers," Lacson said in a news release on Friday.

 

PHINMA boosts property arm with P300-M capital for Saludad project [BusinessWorld, July 18, 2025]

DEL ROSARIO-LED conglomerate PHINMA Corp. has infused P300 million into its property subsidiary, PHINMA Property Holdings Corp. (PHINMA Properties), for the development of the 21-hectare Saludad township in Bacolod City.

 

Tighter rules and taxes, not online gambling ban [The Manila Times, July 18, 2025]

Among the options under consideration are higher Philippine Amusement and Gaming Corp. (Pagcor) fees and franchise charges, additional taxes to be imposed by the Bureau of Internal Revenue (BIR) and broader regulation including a potential mandate requiring licensed operators to list on the Philippine Stock Exchange.

 

Ex-BIR exec to serve year in prison after Sandigan denies bail, appeal [Inquirer.Net, July 18, 2025]

Prosecutors stated that Carpio, citing connections at the Quezon City Registry of Deeds, offered to facilitate a property transfer and secure a new land title for the complainant for P125,000, according to an earlier Sandigan ruling.

 

SSS acquires 740-M Century Properties shares [BusinessWorld, July 18, 2025]

LISTED real estate developer Century Properties Group, Inc. (CPG) has sold P500 million worth of shares to the state-led Social Security System (SSS) through a block sale transaction.

 

Carla Abellana calls out alleged tax corruption in the Philippines [Inquirer.Net, July 17, 2025]

The messages revealed how officials involved allegedly offered to lower the declared value of a property in exchange for a cut—60% of the total savings from the reduced taxes.

 

Did Your School Make It? 80+ Philippine Universities Ranked Among World’s Most Innovative in WURI 2025 [Good News Pilipinas, July 17, 2025]

More than 80 universities and colleges from the Philippines landed in the prestigious WURI 2025 Global Top 400 Innovative Universities ranking released by the World’s Universities with Real Impact (WURI).

 

SteelAsia gets ‘green lane’ status for Candelaria project [Philippine Daily Inquirer, July 17, 2025]

The Board of Investments (BOI) has granted green lane certification to the P30-billion project of major steel manufacturer SteelAsia Manufacturing Corp. in Quezon province.

 

Marcos OKs private sector help to run North-South Commuter Railway [The Philippine Star, July 16, 2025]

Once fully operational, the NSCR will feature both commuter and limited express trains. The limited express trains will be faster, reaching speeds of 120 to 130 kilometers per hour.

 

Tourism MSMEs offered SBCorp. loan package [BusinessWorld, July 16, 2025]

The DTI’s financing arm, the Small Business Corp. (SBCorp.), the loan program will allow MSMEs to borrow up to P20 million.

2. SUPREME COURT RECALLS EARLIER COMPLIANCE OF ALL NOTARIES PUBLIC ON THE PAYMENT & AFFIXTURE OF LOOSE DOCUMENTARY STAMPS PRIOR TO NOTARIZATION

Office of the Court Administrator (OCA) of the Supreme Court (SC) issued a Memorandum Order on July 3, 2025, withdrawing the earlier Memorandum dated November 15, 2024, instructing all executive judges of the first and second level courts to remind the notaries public within their jurisdiction to strictly comply with Par. 2, Sec. 201 of the National Internal Revenue Code (NIRC) of 1997, as amended, specifically on the payment and affixture of loose Documentary Stamps to taxable documents prior to notarization.

3. BIR PRESCRIBES NEW FORMATS FOR VAT ZERO-RATING CERTIFICATES UNDER THE CREATE MORE ACT

Revenue Memorandum Circular (RMC) No. 071-2025, issued on July 11, 2025, amends the provisions of RMC No. 36-2022 by prescribing a revised format for the Value-Added Tax (VAT) Zero-Rating Certificate to be issued by Investment Promotion Agencies (IPAs) to Registered Business Enterprises (RBEs). The amendment aligns with the provisions of the Republic Act (R.A.) No. 12066, also known as the CREATE MORE Act, and R.A. No. 11534, known as the CREATE Act. The Circular prescribes two new templates for the VAT Zero-Rating Certificate. Template 1, with Annex “A,” is intended for VAT Zero-Rating Certificates issued to Registered Export Enterprises (REEs) and High-Value Domestic Market Enterprises (HVDMEs) registered under RA No. 12066. Template 2, also with Annex “A,” refers to the VAT Zero-Rating Certificates issued to RBEs that were granted incentives prior to the effectivity of R.A. No. 11534. All VAT Zero-Rating Certificates issued henceforth must conform to the newly prescribed formats.

4. BIR ITAD RULING

THE APPLICATION OF THE MOST FAVORED NATION (MFN) CLAUSE IS CONTINGENT UPON THE MEETING OF ALL THE PRESCRIBED CONDITIONS, THE FAILURE OF WHICH RENDERS THE MFN CLAUSE INAPPLICABLE

G Restaurant Company Inc. (G Co.), a corporation duly incorporated under Philippine laws, is seeking confirmation on whether the royalties paid to P International Inc. (P Co.), a non-resident corporation (US), are subject to a 10% in accordance with the Most Favored Nation (MFN) clause of the Philippines-United States (PH-US) Tax Treaty, in relation to the Philippines-Czech Republic (PH-CZ) Tax Treaty. In reply, the Supreme Court in Cargill Philippines Inc. v. Commissioner of Internal Revenue, held that two (2) conditions must be met to invoke the MFN clause: (1) similarity in subject matter; and (2) similarity in circumstances of tax payment." The first (1st) condition was satisfactorily met as the definition of royalties under Article 13(3) of the PH-US Tax Treaty and Article 12(2) of the PH-CZ Tax Treaty are substantially similar. However, the second (2nd) condition pertaining to circumstances in the payment of tax was not met. While both treaties apply the ordinary credit method, the US imposes a per income category (basket), whereas the Czech Republic applies a per-country approach. In light of the foregoing and G Co.’s failure to fully comply with the conditions established by the Supreme Court for the application of the MFN clause, the royalty payments to P Co. are not eligible for the reduced rate of 10%. Consequently, they are subject to the standard 25% withholding tax under Article 13(2)(b)(i) of the said treaty. [BIR ITAD RULING NO. 012-25, APRIL 14, 2025]

5. SEC LEGAL OPINION

[FOREIGNERS CAN BE NOMINATED & ELECTED TO THE BOARD OF A CONDOMINIUM CORPORATION FOR TWO (2) SEATS OUT OF 5, REGARDLESS OF FOREIGN OWNERSHIP PARTICIPATION] [CONDOMINIUM GOVERNANCE OPENS TO FOREIGN PARTICIPATION BEYOND ACTUAL EQUITY]

C Park Tower One Condominium Corporation (C CondoCorp) is seeking an opinion on whether foreigners may be nominated and elected to two (2) out of the five (5) seats in its Board of Directors, regardless of the actual percentage of foreign ownership, which currently stands at 12.5%. The request is premised on the fact that since condominium corporations are allowed by law to have up to 40% foreign ownership, such an allowable threshold should serve as the basis for determining foreign participation in the Board. In reply, the SEC, through SEC OGC Opinion No. 25-10 dated 07 July 2025, confirmed that foreigners may indeed be elected to two (2) out of five (5) board seats, even if their actual ownership is less than 40%. The Commission cited Section 2-A of the Anti-Dummy Law, which generally restricts foreign board participation to their allowable equity share in corporations engaged in partially nationalized activities. However, referring to Department of Justice (DOJ) Opinion No. 40, Series of 2023, the SEC clarified that the restriction based on actual ownership applies only to entities considered public utilities or those engaged in advertising. Since C CondoCorp falls under neither category, the SEC ruled that the 40% allowable foreign ownership threshold applies. Consequently, foreigners may validly occupy up to two (2) board seats in C CondoCorp, consistent with the allowable foreign equity limit, regardless of their actual shareholding. [SEC OFFICE OF THE GENERAL COUNSEL OPINION NO. 25-10, JULY 7, 2025]

6. COURT OF TAX APPEALS CASE

TAX ASSESSMENTS SHOULD BE CANCELLED FOR THE BIR'S FAILURE TO PROVIDE REASONS FOR REJECTING TAXPAYER PROTEST

Petitioner The Philippine Stock Exchange, Inc. filed a Petition for Review seeking the cancellation of the assessments issued by the Respondent Commissioner of Internal Revenue (CIR) for the taxable year 2016. Petitioner contended that the assessments were void due to the Respondent’s failure to issue the Formal Letter of Demand (FLD) within the prescriptive period, as allegedly extended by defective waivers of the defense of prescription. Likewise, there was a violation of due process, asserting that its protests and arguments were disregarded without explanation in both the FLD and the Final Decision on Disputed Assessment (FDDA). Additionally, it sought the refund of the amount which had been garnished from its bank account through a Warrant of Garnishment. In contrast, the Respondent argued that the waivers were valid under Revenue Memorandum Order (RMO) No. 14-2016 and that the FLD was timely issued, especially when taking into account the 137-day suspension of the statute of limitations due to COVID-19, as implemented through Revenue Regulations and Memorandum Circulars issued in 2020. Likewise, assessments were validly issued, the taxpayer was given ample opportunity to be heard, and the Court had no jurisdiction over the refund claim due to alleged procedural lapses. In ruling, the Court held that while the waivers were indeed valid and the FLD was timely—especially after considering the additional suspension of 75 days due to the Modified Enhanced Community Quarantine (MECQ) in August 2020—the assessments were nevertheless void for failure to comply with due process requirements. The Court found that the FLD and FDDA failed to state the reasons for rejecting the Petitioner’s protest arguments, in violation of Section 228 of the Tax Code and the relevant implementing revenue regulations. Citing the Supreme Court's ruling in CIR v. Avon Products Manufacturing, Inc., the Court emphasized that a valid assessment must inform the taxpayer in writing of both the facts and the law upon which it is based; otherwise, it is void. Consequently, the Court GRANTED the Petition, declaring the entire assessment null and void, and ordering the Respondent to refund the amount garnished from the Petitioner’s bank account. [THE PHILIPPINE STOCK EXCHANGE, INC. VS. COMMISSIONER OF INTERNAL REVENUE, CTA CASE NO. 10781, JULY 4, 2025]


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