BIR offers voluntary assessment program

The Bureau of Internal Revenue (BIR) is offering a program that would allow taxpayers to clean up their tax arrears by paying their correct internal revenue taxes for the past years.

BIR Commissioner Rene Bañez said taxpayers who inadvertently filed erroneous tax returns have until next month or Sept. 30 to declare their correct income statements and pay the corresponding taxes under the bureau’s project, dubbed as Voluntary Assessment Program (VAP).

"We are giving taxpayers a chance to avail of the program to pay their correct taxes and avoid the inconvenience experienced in the audit and investigation of their records," Bañez said.

On orders of Finance Secretary Jose Isidro Camacho, Bañez gave the taxpayers the privilege of last priority in the audit and investigation of all internal revenue taxes, including improperly accumulated tax earnings.

Bañez clarified that the computation of tax due will still be based on the existing rates of five percent of 32 percent.

The commission explained that the 20 percent tax being withheld from every individual is considered as tax savings. "If in case the amount of taxes withheld would be higher than the actual income tax due, the excess amount will be refunded."

"Creditable withholding tax, which is subtracted from the final tax, should not be misunderstood as an additional amount for their income tax due," Bañez said.

In the BIR’s Revenue Regulation 6-2001, a creditable withholding tax has been set at 20 percent of gross income of professional, promotional and talents fees of professional entertainers.

Bañez said professional entertainers include actors, actresses, singers, professional athletes like basketball players, pelotaris, jockeys and directors of movies, stage, radio, television and musical presentations.

On the other hand, the creditable withholding tax for individuals like lawyers, certified public accountants, doctors, architects and engineers remains at 10 percent.

Earlier, several actors and actresses, including Nida Blanca and Armida Siguion-Reyna, held a rally in front of the Department of Finance to protest the 20 percent tax deduction from their talent fees.