The Lawphil Project - Arellano Law Foundation
DIGEST OF 2000 REVENUE MEMORANDUM ORDERS
DIGEST OF 2000 REVENUE MEMORANDUM ORDERS
Revenue Memorandum Order No. 1-2000
Revenue Memorandum Order No. 2-2000
Revenue Memorandum Order No. 3-2000
Revenue Memorandum Order No. 4-2000
Revenue Memorandum Order No. 5-2000
Revenue Memorandum Order No. 6-2000
Revenue Memorandum Order No. 7-2000
Revenue Memorandum Order No. 8-2000
Revenue Memorandum Order No. 9-2000
Revenue Memorandum Order No. 10-2000
Revenue Memorandum Order No. 11-2000
Revenue Memorandum Order No. 12-2000
Revenue Memorandum Order No. 13-2000
Revenue Memorandum Order No. 14-2000
Revenue Memorandum Order No. 15-2000
Revenue Memorandum Order No. 16-2000
Revenue Memorandum Order No. 17-2000
Revenue Memorandum Order No. 18-2000
Revenue Memorandum Order No. 19-2000
Revenue Memorandum Order No. 20-2000
All sales invoices and receipts (including cash register tapes) issued by business establishments from July 1 to December 10, 2000, regardless of amount, will qualify as entries for the raffle promo, provided that the business name and address, Taxpayer Identification Number (TIN) and date of issuance appear on the invoice/receipt/tape. The name of printer (BIR permit number), with the inclusive serial number of the booklets, must also appear in the sales invoices/receipts in order to qualify as entries.
A person is qualified to win one prize separately in any of the draws and shall be entitled to all such prizes. However, if a person wins more than once in the same draw, he shall be entitled to receive only the higher prize. Receipts not drawn during the Regional draws will still be included as entries in the Area and National draws. In cases wherein the winning receipts/invoices are spurious, the winner will still be entitled to the prize. However, the establishment that issued such receipt/invoice shall be subject to investigation. A participant who has falsified the winning invoice or receipt shall not be entitled to the prize.
Revenue Memorandum Order No. 21-2000
A Computerized System Evaluation Team (CSET) shall be created for the National Office and Regional Office to conduct appropriate evaluation and recommend approval of the taxpayers' application to adopt CAS or its components. Evaluation shall be undertaken and completed within 30 days from receipt of the application and complete documentary requirements. Request for the approval of CAS shall be open to all taxpayers, whether classified as regular or large taxpayer. Taxpayer requesting approval for a Computerized Book of Accounts with computer-generated accounting records, whether the accounting system to be used is off-the-shelf or customized, need not apply for an authority to print (ATP) invoices and receipts. However, taxpayer requesting approval for a Computerized Book of Accounts without computer-generated accounting records shall need an ATP for their official receipts, invoices and the like.
The permit to adopt CAS shall be deemed revoked whenever there are changes or modifications introduced into the approved CAS, or upon full consumption of the pre-approved range of serial numbers for the computer-generated official receipt or sales/cash invoice. Any such changes or modifications shall require a new permit. On the other hand, computer-generated accounting records with no pre-approved range of number of invoices and receipts prior to actual generation shall be reported to the Chief, Large Taxpayers Assistance Division, or the Chief, Excise Taxpayers Assistance Division or Revenue District Officer for proper recording and notation of the range of numbers of official receipts and invoices which have been consumed, as well as the range of numbers which have been cancelled during the immediately preceding taxable year within 30 days from the close of such taxable year. With the favorable recommendation of the CSET, the approval and signing of the permit to adopt CAS shall be the responsibility of the Assistant Commissioner of the Large Taxpayers Service or Excise Taxpayers Service for large taxpayers, and the Revenue District Officers for regular taxpayers.
Revenue Memorandum Order No. 22-2000
Each RDO shall undergo the soft launch phase for one month, followed by a two-month hard launch phase. Identification of the stop-filer cases will only be conducted for due dates covering the one-month period prior to the rollout date. All open, unassigned stop filer cases prior to soft launch will be closed. Corresponding reminder letters will be purged.
Each seizure agent is expected to be assigned a minimum of 50 stop-filer cases and close a minimum of 25 stop-filer cases every month. Each identified Revenue Officer (Assessment) is expected to be assigned a minimum of 25 stop-filer cases and close a minimum of 13 stop-filer cases every month.
Revenue Memorandum Order No. 23-2000
Revenue Memorandum Order No. 24-2000
The issuance of Letters of Authority (LAs) will be based on the selection criteria specified in the Order. Specifically, mandatory audit will cover the following cases: 1) estate/donor's tax returns; 2) taxpayers retiring from business; 3) claims for income tax credit/refund; 4) transfer of property in exchange for shares of stocks and other sale, transfer or exchange of shares of stocks not listed in the stock market; 5) government withholding agents; and 6) taxpayers selected for tax audit based on third party information referred by the Assessment Service.
If the foregoing mandatory audits do not provide sufficient workload for the RDO, the Revenue District Officer may select the following top priority taxpayers for audit: 1) taxpayers in the district who filed break-even returns or with returns showing net loss for at least two (2) consecutive years; 2) top 100 taxpayers in the district in terms of gross sales/receipts where there is no VAT or percentage tax payment for the current year and the immediately preceding year; 3) taxpayers with substantial reduction in gross sales/receipts/tax payments and/or substantial increase in costs of sales and expenses; 4) taxpayers with substantial tax deficiency resulting from short-audit of their tax liabilities; and 5) taxpayers belonging to the top two industries within the respective area of jurisdiction of the RDO with the lowest percentage of tax compliance.
The Assessment Service shall match the lists of taxpayers submitted by the RDOs with the lists of taxpayers to be investigated by the audit divisions in the National Office prior to approval to preclude multiple issuance of LAs to the same taxpayer for the same taxable year. Cases to be covered by LAs shall be classified according to gross assets or gross sales/receipts, whichever is higher, as of December 31, 1997, December 31, 1998 and December 31, 1999 using the categories specified in the Order. All LAs shall be issued and approved by the Regional Director. However, no LAs for the investigation of taxpayers falling under the priority target taxpayers shall be issued by the Regional Director without prior written approval of the ACIR, AS. The policy on the simultaneous investigation of all liabilities of the taxpayer shall be followed. The practice of issuing mission orders, correspondence letters, or any other similar orders for the purpose of audit examination and assessment of internal revenue taxes under this Order is strictly prohibited.
Only Revenue Officers-Assessment Group shall be authorized to conduct audit and investigation of tax cases, whether in a principal or assisting capacity. The initial workload for every Revenue Officer will be a minimum of twenty (20) cases and maximum of thirty (30) cases. No new tax case shall be assigned to a Revenue Officer until he has completed the audit and has reported the following cases pending with him within one (1) month from the effectivity of this Order: a) prescribing cases/dockets; b) cases for re-investigation; c) cases involving claims for tax refund/credit assigned before April 30, 2000; d) third party information cases; e) cases of retiring taxpayers assigned before April 30, 2000; and f) cases held for more than twelve (12) months.
Revenue Memorandum Order No. 25-2000
The analysis and evaluation of information will cover the following areas: a) gross profit ratio of each company and the standard gross profit ratio for the particular industry; b) compliance to applicable tax laws of each company and of the industry as a whole; c) industry issues; and d) possible areas with tax potential.
Revenue Memorandum Order No. 26-2000
Revenue Memorandum Order No. 27-2000
Revenue Memorandum Order No. 28-2000
Revenue Memorandum Order No. 29-2000
Users are encouraged to open/read mail daily. Dormant or inactive accounts for one (1) month shall be automatically deleted. Users availing leave of absence for one (1) month or more should notify in writing the Systems Support Division in order for their accounts not to be deleted.
The E-mail facility should be used for the purpose for which they are authorized (i.e. transmission of official documents etc.) and for enhancing communication for activities that serve the interest of the Bureau. As such, sending of chain letters and other inappropriate materials is not allowed. Accessing of pornographic web sites and downloading pornographic materials using the BIR Internet facility is also strictly prohibited. Moreover, transmission and/or retrieval of any material/document/information in violation of any of the existing policies of the Bureau and the Philippine Government is likewise strictly prohibited. Inappropriate/unauthorized use of the E-mail/Internet browsing facility may result in the revocation of issued account, plus the imposition of appropriate administrative sanction depending on the severity of the violation committed.
Revenue Memorandum Order No. 30-2000
Moreover, the Assistant Commissioner for Excise Taxpayers Service (ACIR, ETS) shall conduct a short audit on the following cases: 1) inconsistencies of sales and purchases declared in VAT return against third party information; 2) taxpayers with substantial reduction in gross sales/receipts/tax payments and/or substantial increase in costs of sales and expenses; 3) inconsistency between VAT payment vis-à-vis excise tax payment; 4) VAT input is greater than VAT output for at least two (2) consecutive quarters; 5) unverified taxpayer's declaration of substantial increase in gross sale or revenue as per their own press release or publication; and 6) reported violations of the provisions of excise tax laws, rules and revenue regulations pertaining to production/removal of excisable articles.
For regular audit, selection of excise taxpayers will be based on the following order of priorities: 1) filing of break-even returns or returns showing net loss for at least two (2) consecutive years; 2) excise taxpayers with asset growth but reported net loss; 3) excise taxpayers with history of low/non-compliance; 4) multinational-corporate excise taxpayers; and 5) other selected excise taxpayers.
Non-LA cases shall be covered by Tax Verification Notices (TVNs) or Memoranda, which shall be issued and approved by the ACIR, ETS, unless otherwise delegated in writing to the Chief, Excise Taxpayers Operations Division.
A Revenue Officer/Group Supervisor shall not audit/investigate the same taxpayer for two (2) consecutive years/periods. Revenue Officers shall conduct the audit within one hundred twenty (120) days from the date of issuance of LA and submit their corresponding report of investigation. If the final report is not completed within the 120-day period, the Revenue Officers shall submit a progress report and shall request for the revalidation of said LA. For short audits, the investigation and submission of reports shall be completed within sixty (60) days from the date of issuance of LA.
Revenue Memorandum Order No. 31-2000
Revenue Memorandum Order No. 32-2000
The original and duplicate copies of returns/documents "with payment" from the AABs shall be picked up by the respective RDOs. The Revenue District Officers shall be responsible for monitoring and facilitating resolution of their return suspense errors. The Bank Document Analysts of the concerned RDO shall attend to the inquiries of AABs regarding the procedural and encoding errors they have committed. The Document Processing Section, on the other hand, shall be responsible for the temporary safekeeping of original returns and updating of document status in the ITS.
Revenue Memorandum Order No. 33-2000
Revenue Memorandum Order No. 34-2000
Revenue Memorandum Order No. 35-2000
Revenue Memorandum Order No. 36-2000
All office audit cases shall be covered by Office Audit Letters of Authority. The issuance of correspondence letter or any other similar orders for the purpose of audit examination shall be strictly prohibited. The policy on the simultaneous investigation of all tax liabilities of the taxpayer for the same taxable year shall be followed. One Letter of Authority shall be issued for each taxable year under audit, to include all internal revenue tax liabilities of the taxpayers.
The same taxpayer shall not be allowed to be audited for the immediate succeeding taxable year, unless there is a written justification for the conduct thereof and subject to prior approval by the ACIR, AS. The same Revenue Officer/Group Supervisor shall not be allowed to audit the same taxpayer for the immediately succeeding audit period. All reports of office audit shall be subject to final review and approval by the Regional Director.
Revenue Memorandum Order No. 37-2000
The Treasurer of the LGU concerned shall be responsible in informing the Chief, Revenue Accounting Division (RAD) of the actual Special Privilege Tax collections paid to the BIR, based on the certifications of the Revenue Collection Officers (RCOs) of the Revenue District Office (RDO) concerned. Evidence of tax payments secured by the LGU Treasurer on the actual Special Privilege Tax paid by the mini-hydroelectric power developer shall be submitted to the Chief, RAD, together with the certification/s from the Revenue District Officer and Chief, Finance Division and the mini-hydroelectric power company. The LGU Treasurer shall inform the BIR, through the RCO of the RDO concerned, of any taxpayer who fails to pay the 2% Special Privilege Tax. All RCOs receiving such information from LGUs shall coordinate with the Chief, Finance Division and the Chief, RAD in enforcing the collection of said tax.
Revenue Memorandum Order No. 38-2000
The following offices shall be responsible for identifying and segregating A/R for conversion, based on the following group categories: a) Collection Enforcement Division -National Office A/Rs, including Excise Taxpayers Service A/Rs (regardless of amount), with the exception of large taxpayers accounts involving basic tax of P 1 Million and above; b) Collection Division - Regional A/Rs including basic tax of P 100,000.01 to P 999,999.99; c) Revenue District Offices - District A/Rs involving basic tax of P 100,000 and below; and d) Large Taxpayers Service - A/Rs of taxpayers under the jurisdiction of the Large Taxpayers Service, regardless of amount.
Revenue Memorandum Order No. 39-2000
Revenue Memorandum Order No. 40-2000
The RDO will be responsible in resolving all suspended records resulting after every validation and upload to the Integrated Tax System (ITS) database. The ISOS, on the other hand, will be responsible for the immediate updating of taxpayers' registration information to the ITS database based on the Registration Information Update Form/Update of Exemption of Employers and Employees Information Form (Form 1905/2305) submitted by non-computerized RDOs. The ISOS will also cancel and transfer taxpayer records from non-computerized RDOs to other non-computerized RDOs and from non-computerized RDOs to computerized RDOs.
Revenue Memorandum Order No. 41-2000
The following offices shall be responsible for identifying and segregating A/R for conversion based on the following group categories: a) Collection Enforcement Division-National Office A/Rs, including Excise Taxpayers Service A/Rs (regardless of amount), with the exception of large taxpayers accounts involving basic tax of P 1 Million and above; b) Collection Division - Regional A/Rs including basic tax of P 100,000.01 to P 999,999.99; c) Revenue District Offices - District A/Rs involving basic tax of P 100,000 and below; and d) Large Taxpayers Service - A/Rs of taxpayers under the jurisdiction of the Large Taxpayers Service, regardless of amount.
Revenue Memorandum Order No. 42-2000
Cases that cannot be the subject of compromise settlement are: 1) withholding tax cases; 2) criminal tax fraud cases; 3) criminal violations already filed in court; 4) cases involving assessments issued after June 30, 2000; and 5) delinquent accounts with duly approved schedule of installment payments.
All National and Regional Offices are authorized to accept taxpayers' offers of compromise of all outstanding delinquent accounts and disputed assessments as of June 30, 2000, based on the prescribed minimum percentages specified in the Order. For delinquent accounts and disputed assessments of taxpayers registered under the LTS and ETS, the same shall not be compromised for less than 50% of the basic assessed tax. Assessments already issued and sustained by any Court, but has not become final, may be the subject of compromise upon payment of 100% of the basic assessed tax.
The acceptance or approval of a taxpayer's offer of compromise will be based on the following grounds: 1) a reasonable doubt as to the validity of the claim against the taxpayer exists; and 2) the financial position of the taxpayer demonstrates a clear inability to pay the assessed tax.
A taxpayer's offer of compromise shall be subject to the approval of the National Evaluation Board (NEB) if the basic assessed tax exceeds P 1 million or the settlement offered is less than the minimum rates of 40% (for doubtful validity), 10% (for financial incapacity) and 50% (in cases of taxpayers registered under the LTS and ETS) of the basic assessed tax. The Regional Evaluation Board (REB), on the other hand, will evaluate and approve applications for compromise settlement of assessments issued by the respective Regional Offices involving basic assessed taxes of P 500,000.00 or less. For assessments issued by the Regional Offices where the basic assessed tax exceeds P 500,000.00 but not over P 1,000,000.00, or for assessments issued by the National Office where the basic assessed tax does not exceed P 1,000,000.00, the compromise offer shall be approved by the Commissioner of the Internal Revenue.
Cases with Warrants of Distraint and/or Levy and/or Warrants of Garnishment are also covered in the Compromise Settlement Program. Cases with final decision of any court, on the other hand, can only be compromised on the ground of financial incapacity.
The deadline for the filing of the application for compromise settlement is November 15, 2000.
Revenue Memorandum Order No. 43-2000
All seconded/detailed personnel assigned to a Special Project will be rated by their respective project supervisors. In the case of employees who are sent on training/scholarship for more than three (3) months, their performance rating for the last rating period prior to the grant will be considered.
The PES uses a cross-rating scheme to include the rating given by the employee's supervisor and the rating given by peers, subordinates and clients. For this purpose, Subordinate raters and Peer raters will be identified at the start of the rating period.
Only employees with Outstanding and Very Satisfactory performance rating will be considered for promotion. Two (2) successive Unsatisfactory ratings or one (1) Poor rating will be ground for dismissal of an employee from the service.
The Service Chiefs, Regional Directors, Division Chiefs, District Officers, and heads of sections/units will be responsible for the rating of their employees' performance and compliance with the system. A Performance Evaluation Review Committee in the Service and the Regional Offices is created to review the performance standards, targets and final rating of personnel.
Revenue Memorandum Order No. 44-2000
The HRIS will provide an integrated human resource system for personnel administration, training management, training delivery and employee welfare. The FMIS, on the other hand, will provide a financial reporting system for budget, accounting and cashiering functions. The codes will serve as primary keys in accessing information within the HRIS and FMIS. Information Technology personnel and functional users from the different divisions under the Human Resource Development Service and Financial and Administrative Service will be given different levels of access to the HRIS and FMIS based on their designation and function. Users granted a read-only access may request for a change of personal information with the Personnel Division.
The location codes will be used to indicate whether a particular office is located at the National Office or under the Revenue Regional Office. The department codes, on the other hand, will be used to indicate the group, service and division to which a section or unit belongs.
Revenue Memorandum Order No. 45-2000
The applicant must also have rendered at least two (2) years of revenue service with a performance rating of Very Satisfactory for the last two rating periods immediately preceding the application. Likewise, the applicant must have no pending administrative and/or criminal charges, including pending service obligation from previous local or foreign scholarship and training contract.
Qualified BIR personnel may avail of the study leave only once, for a maximum period of six (6) months. Revenue officials and employees who are on study leave will not be considered for promotion during the period of the study leave.
Revenue Memorandum Order No. 46-2000
Taxpayers under the jurisdiction of the Large Taxpayers Service, Excise Taxpayers Service and Enforcement Service will not be included in the Program. Likewise, taxpayers under the regular audit jurisdiction of the concerned Revenue District Offices will not be included in the Program where Letters of Authority/Audit Notice (LA/AN) for the investigation of PEZA-registered taxpayers were already issued by the Regional Director.
To investigate the identified PEZA cases, a Regional Coordinating Committee and a Regional Investigating Team will be created in all Regional Offices.
The list of identified PEZA-registered firms recommended to be audited will be submitted by the Regional Director to the ACIR, Assessment Service not later than October 31, 2000, for pre-approval prior to the issuance of the corresponding LA/AN.
Revenue Memorandum Order No. 47-2000
The distribution of items will be implemented by phase, as follows: Phase I - Large Taxpayers Service (LTS), Excise Taxpayers Service (ETS), Enforcement Service (ES), Revenue Data Centers, and all other items with salary grade 26 and above; Phase II - all other National Office Services; and Phase III - all Regional and District Offices. Passing of the competency (qualifying) examination and the cognitive, aptitude and personality test will be a requirement for the assignment of personnel to the LTS, ETS, and ES and other operations group (assessment).
Any employee who feels aggrieved by his/her re-assignment by virtue of the implementation of the Bureau's new organizational structure may file an appeal with the Appeals Committee (created under Revenue Special Order No. 555-2000) within thirty (30) days following his/her receipt of the Bureau's Official Order.
External hiring will be done only for items that remain unfilled after all the existing personnel have been assigned their respective items.
Revenue Memorandum Order No. 48-2000
The Large Taxpayers Service will issue a listing of all taxpayers who will be re-classified from large to regular taxpayers, and will prepare corresponding notification letters, for distribution by corresponding Revenue District Offices having jurisdiction over such taxpayers' head offices.
Following their receipt of notification letter, the reclassified taxpayers will be guided by the procedures for returns to be filed prescribed in the Order.
Revenue Memorandum Order No. 49-2000
For policy cases, the Audit Program will cover the examination of 1999 income, value-added, percentage, withholding and other internal revenue tax liabilities of selected taxpayers falling within the following industries: a) chemical and chemical products; b) food and beverage; and c) such other lines of industry and/or cases as may be assigned by the Commissioner.
For income tax purposes, taxable year 1999 will cover returns filed on a fiscal year basis ending on or before June 30, 2000.
Revenue Memorandum Order No. 50-2000
The Regional Directors and Assistant Commissioners of the Large Taxpayers Service and Excise Taxpayers Service will monitor the posting of the "Notice" by every taxpayer within their area of jurisdiction.
In case of transfer or change in the registered address of the taxpayer, the "Notice" will have to be surrendered, for cancellation, and a new "Notice" will be issued by the concerned BIR office.
A fine of P 1,000 or imprisonment of not more than six (6) months, or both will be imposed upon each establishment found violating this Order.
Revenue Memorandum Order No. 51-2000
The Compromise Settlement Program under RMO No. 42-2000 is also extended until December 31, 2000.
Revenue Memorandum Order No. 52-2000
Revenue Memorandum Order No. 53-2000
Revenue Memorandum Order No. 54-2000
The Order will cover the following persons: 1) those perceived to be not declaring their correct income, sales or receipts; 2) those who failed to issue official receipts and invoices or have issued unregistered official receipts/invoices or found to be in possession of unregistered invoices/official receipts, including unregistered cash register machines and point of sale machines; 3) those who failed to file returns/forms/statements at the time prescribed by law or who willfully or otherwise file fraudulent returns/forms/statements; and 4) those who failed to register with the BIR.
All surveillance activities will be covered by Mission Orders to be requisitioned by authorized revenue officials. The surveillance activities will be conducted by at least two (2) officers comprised of Revenue Officers - (Assessment/Excise), Intelligence Officers and Special Investigators. The findings of the surveillance activities may be used as the basis for assessing taxes for the other months or quarters of the same or different taxable years, and such assessment will be deemed prima facie correct.
Revenue Memorandum Order No. 55-2000
Revenue Memorandum Order No. 56-2000
The schedule of prescribed compromise penalties shall not prevent the Commissioner or his duly authorized representative from accepting a compromise amount higher than as provided thereof. A compromise offer lower than the prescribed amount may be accepted after approval by the Commissioner of Internal Revenue or his duly authorized representative.
Revenue Memorandum Order No. 57-2000
The grounds for the suspension or temporary closure of business are the following: a) failure to issue receipt or invoices by a VAT-registered or registrable taxpayer; b) failure to file a value-added tax return; c) understatement of taxable sales or receipts by 30% or more of the correct amount in the case of a VAT-registered or registrable taxpayer; and d) failure to register.
No surveillance activities shall be conducted nor apprehension effected unless the same has been authorized by a mission order issued in accordance with the provisions of RMO No. 54-2000.
The recommendation for the suspension or temporary closure of business will have to be supported with documentary proof specified in the Order.
Revenue Memorandum Order No. 58-2000
Applications for travel abroad will be prepared and filed in accordance with the provisions of Department of Finance-Memorandum Circular Nos. 9-80, 7-84 and 5-85. All request for travel abroad of BIR officials or employees below the rank of Deputy Commissioner, whether for official or personal reasons, must be filed with the Personnel Division of the BIR-NOB at least 15 days prior to the actual departure/travel of the applicant.
The Commissioner has the exclusive authority to approve/disapprove requests for permission to travel abroad, which authority may be delegated at the discretion of the Commissioner. Recommendations for the approval of any request for permission/authority to travel abroad will be jointly made by the Deputy Commissioner for Resource Management Group (DCIR-RMG) and by the Deputy Commissioner having administrative jurisdiction over the requesting personnel.
The Lawphil Project - Arellano Law Foundation