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Advocates Philippines
President Signs 'Ease Of Paying Taxes Act' Into Law
Photo credit: PBBM
In a move towards economic and social development, President Ferdinand R. Marcos Jr. signed Republic Act No. 11976, also known as the "Ease of Paying Taxes Act," into law on Friday. The legislation, highlighted as a priority during the President's State of the Nation Address in both 2022 and 2023, is anticipated to play a pivotal role in achieving the administration's 8-Point Socioeconomic Agenda.
The newly enacted law aims to modernize and enhance the efficiency of tax administration, reinforcing taxpayer rights, and optimizing revenue collection through digitization initiatives. With a focus on streamlining processes and reducing the burden on taxpayers, the legislation introduces administrative tax reforms and amendments to various sections of the National Internal Revenue Code of 1997.
Among the notable features of the law are the classification of taxpayers into micro, small, medium, and large categories, the option for electronic or manual filing of returns and payment of taxes, and the elimination of the distinction between documentation and basis of sales of goods and services. The law also introduces classifications for value-added tax (VAT) refund claims based on risk levels.
Furthermore, RA No. 11976 imposes a 180-day limit for the government to act on claims for the refund of erroneous or illegal tax collection. It also raises the mandatory issuance of receipts for each sale and transfer of goods and services from one hundred pesos (P100) to five hundred pesos (P500) and reduces the number of income tax return (ITR) pages from four to two.
The law signifies a commitment to adopting best practices, updating the Philippine taxation system, and replacing antiquated procedures. It mandates an integrated digitalization strategy for the Bureau of Internal Revenue (BIR), promoting end-to-end solutions and the use of technology to enhance taxpayer services.
To ensure a smooth transition, the law grants a 15-day grace period after its publication in the Official Gazette or a newspaper of general circulation before it takes effect.
Additionally, the implementing rules and regulations (IRR) are set to be promulgated 90 days from the law's effectivity after consultation with the Finance Secretary and the private sector.
The newly enacted law aims to modernize and enhance the efficiency of tax administration, reinforcing taxpayer rights, and optimizing revenue collection through digitization initiatives. With a focus on streamlining processes and reducing the burden on taxpayers, the legislation introduces administrative tax reforms and amendments to various sections of the National Internal Revenue Code of 1997.
Among the notable features of the law are the classification of taxpayers into micro, small, medium, and large categories, the option for electronic or manual filing of returns and payment of taxes, and the elimination of the distinction between documentation and basis of sales of goods and services. The law also introduces classifications for value-added tax (VAT) refund claims based on risk levels.
Furthermore, RA No. 11976 imposes a 180-day limit for the government to act on claims for the refund of erroneous or illegal tax collection. It also raises the mandatory issuance of receipts for each sale and transfer of goods and services from one hundred pesos (P100) to five hundred pesos (P500) and reduces the number of income tax return (ITR) pages from four to two.
The law signifies a commitment to adopting best practices, updating the Philippine taxation system, and replacing antiquated procedures. It mandates an integrated digitalization strategy for the Bureau of Internal Revenue (BIR), promoting end-to-end solutions and the use of technology to enhance taxpayer services.
To ensure a smooth transition, the law grants a 15-day grace period after its publication in the Official Gazette or a newspaper of general circulation before it takes effect.
Additionally, the implementing rules and regulations (IRR) are set to be promulgated 90 days from the law's effectivity after consultation with the Finance Secretary and the private sector.
Jan 8, 2024
