By Louella D. Desiderio (The
Philippine Star) | Updated March 31, 2015 - 12:00am
MANILA, Philippines - Business groups
are calling on the Bureau of Internal Revenue (BIR) to make the submission of
information on taxpayers’ extra income in the filing of the annual income tax
return optional again for calendar year 2014.
In a joint position paper submitted to
the Department of Finance and BIR on March 27, business groups Philippine
Chamber of Commerce and Industry, Employers Confederation of the Philippines,
Financial Executives Institute of the Philippines, Management Association of the
Philippines, Philippine Exporters Confederation Inc., Philippine Institute of
Certified Public Accountants and the Tax Management Association of the
Philippines expressed concern over the mandatory submission of the Supplemental
Information Return (SIR) or information on passive income as part of the annual
income tax returns as prescribed in Revenue Regulations No. 2-2014 and
reiterated in Revenue Memorandum Circular No. 9-2014.
The submission of the SIR would mean
providing information on passive income that are tax exempt or have been
subjected to final withholding taxes.
The additional information includes
proceeds of life insurance policy, return of premium retirement benefits,
pensions and gratuities, personal or
real properties received thru gifts, bequests and devises as well as gains for
the sale or exchange of properties.
“We respectfully request that
compliance with the SIR requirement be made optional again on the part of the
taxpayer for income tax returns starting calendar year 2014,” the groups said.
This, as the groups noted that the
reporting requirement was made optional for calendar year 2013 due for filing
on or before April 2014.
The BIR decided to make the reporting
requirement optional last year amid opposition by business groups and
legislators citing violation of right to privacy and bank secrecy laws.
The business groups said the SIR
reporting is also seen as a redundant requirement since the needed information
is already available to the BIR from the reports submitted by the taxpayers.
Such requirement, they said, would
just impose additional burden to taxpayers and would not necessarily increase
collections of the BIR.
The reporting requirement is likewise
difficult to implement, considering the nature and details of information
required to be reported.
The groups said gathering all the
required details on the passive income items is a tedious process.
“It is to be noted that one of the
attractions for choosing investments with tax free or net of tax yields is the
exemption from the hassle of accounting for and reporting of income received
from said investments in the case of individual taxpayers. The requirement to
account for and report such income negates that advantage,” the groups added.
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