Professional Documents
Culture Documents
Aban
CABANEIRO) A2011
IN GENERAL
Remedies of the government
1. Tax lien
2. Compromise
3. Distraint
4. Levy
5. Civil action
6. Criminal action
7. Forfeiture
8. Suspension of business operations in violation of VAT
9. Enforcement of administrative fine
TAX LIEN
Tax lien
Only one property subject to tax
When a taxpayer neglects or refuses to pay his internal
revenue tax liability after demand, the amount so
demanded shall be a lien in favor of the government from
the time the assessment was made by the Commissioner
until paid with interest, penalties, and costs that may secure
in addition thereto, upon all property and rights to property
belonging to the taxpayer. [Section 219, NIRC]
Lien shall not be valid against any mortgagee, purchaser or
judgment creditor until notice of such lien shall be filed by
the Commissioner in the Register of Deeds of the province
or city where the property of the taxpayer is located.
A tax lien created in favor of the government is superior to
all other claims and preferences, even to that of a private
litigant predicated on a court judgment.
Tax lien and Distraint
Tax lien is directed to the property subject to the tax,
regardless of the owner.
COMPROMISE
Compromise v. abatement
CIR may compromise both civil and criminal liability of the
taxpayer
Unlike compromise which involves a reduction of the
taxpayers liability, abatement of tax means that the entire
tax liability of the taxpayer is cancelled.
Compromise and abatement have different grounds.
Grounds for compromise
1. A reasonable doubt as to the validity of the claim
against the taxpayer exists; or
2. The financial position of the taxpayer demonstrates a
clear inability to pay the assessed tax
Grounds for abatement
1. When the tax or any portion thereof appears to be unjustly
or excessively assessed.
2. When the administration and collection costs involved do
not justify the collection of the amount due.
Cases
1.
2.
3.
4.
5.
Cases
1.
2.
3.
4.
schedule
of
TAX REVIEWER: LAW OF BASIC TAXATION IN THE PHILIPPINES BY: Benjamin B. Aban
CABANEIRO) A2011
TAX REVIEWER: LAW OF BASIC TAXATION IN THE PHILIPPINES BY: Benjamin B. Aban
CABANEIRO) A2011
TAX REVIEWER: LAW OF BASIC TAXATION IN THE PHILIPPINES BY: Benjamin B. Aban
CABANEIRO) A2011
Advertisement of sale
Within 20 days after levy.
Posting a notice of sale at least 30 days at the main
entrance of the municipal or city hall and in public and
conspicuous place in the city or municipality where the
property is located.
Publication once a week for three weeks in a newspaper of
general circulation in the municipality or city where the
property is located.
Redemption of real property sold
Delinquent taxpayer have the right to redeem the real
property sold by him or any one for him within one (1) year
from the date of sale.
Taxpayer must pay the amount of public taxes, penalties,
and interest from the date of delinquency to the date of
sale, together with interest on said purchase price at the
rate of 15% per annum from the date of purchase to the
date of redemption.
Fatal
1.
2.
3.
4.
TAX REVIEWER: LAW OF BASIC TAXATION IN THE PHILIPPINES BY: Benjamin B. Aban
CABANEIRO) A2011
FORFEITURE
Forfeiture
The effect of forfeiture is to transfer the title to the specific
thing from the owner to the government.
May be
redeemed.
In case of personal property: The forfeiture of chattels
and removable fixtures of any sort is enforced by seizure
and sale or destruction of the specific forfeited property.
In case of real property: This forfeiture of real property is
enforced by a judgment of condemnation and sale in a legal
action or proceeding, civil or criminal, as the case may
require.
Forfeiture of property used in unlicensed business or dies
used for printing false stamps, etc
All chattels, machinery, and removable fixtures of any sort
used in the unlicensed production of articles subject to
excise tax shall be forfeited.
Dies and other equipment used for the printing or making of
any internal revenue stamp, label or tag which is in
imitation of or purports to be a lawful stamp, label or tag
shall also be forfeited.
Forfeiture of goods illegally stored or removed
Unless
otherwise
specifically
authorized
by
the
Commissioner, all articles subject to excise tax should not
be stored or allowed to remain in a distillery, distillery
warehouse, bonded warehouse or other place where made,
after the tax thereon has been paid; otherwise all such
articles shall be forfeited.
Articles withdrawn from any such place or from customs
custody or imported into the country without the payment
of the required tax shall likewise be forfeited.
CIVIL AND CRIMINAL ACTIONS
Civil and criminal actions
Civil action
Civil action, as a mode of tax collection, is resorted to when
a tax liability becomes collectible.
Collectibility of a tax arises in the following instances:
1. When a tax is assessed but the assessment becomes
banal and unappealable because the taxpayer fails to
file an administrative protest within 30 days.
2. When a protest against the assessment is filed by the
taxpayer and a decision is rendered by the
Commissioner but said decision becomes final,
executory and demandable for failure of the taxpayer to
file an appeal within 30 days.
A civil action may also be filed in order to collect the so
called self assessed tax
No civil action for recovery of taxes shall be filed without the
approval of Commissioner also criminal.
Insufficient protest allowing collection case
In Dayrit v. Cruz [L-39910, September 26, 1988], the
Supreme Court ruled that the request for reconsideration
cannot be considered as a protest against the assessment.
According to the Supreme Court, the failure of the heirs to
substantiate their claim against the assessment due to the
TAX REVIEWER: LAW OF BASIC TAXATION IN THE PHILIPPINES BY: Benjamin B. Aban
CABANEIRO) A2011
TAX REVIEWER: LAW OF BASIC TAXATION IN THE PHILIPPINES BY: Benjamin B. Aban
CABANEIRO) A2011