PILIPINAS Shell Petroleum Corp. (PSPC) on Wednesday said it received the decision of the Court of Tax Appeals (CTA), which ruled in favor of the oil firm, in relation to the P3.5 billion taxes for alkylate imports.
“On May 2, 2023, PSPC received a copy of the decision dated April 27, 2023 of the Court of Tax Appeals Special Second [2nd] Division, which ruled that alkylate is not subject to excise tax and granted PSPC’s amended petition for review dated October 5, 2012,” the oil firm said in a disclosure to the stock exchange.
When sought for comment, PSPC Media Relations Manager Cesar Abaricia said the oil firm is “thankful for the decision of the CTA favoring SPC on its alkylate case.”
“Rest assured that [PSPC] continues to work with the government for the benefit of the country, its employees, customers and shareholders in fulfilling its strategy,” Abaricia added.
According to the executive, the court’s decision would not have an impact on its financial performance as PSPC had ceased its refinery operations.
According to PSPC, the CTA invalidated Document M-059-2012 issued by the Bureau of Internal Revenue (BIR) on June 29, 2012 to the Bureau of Customs (BOC), which ordered the imposition of taxes on the oil firm’s alkylate importations. The October 1, 2012, letter of the BOC was, likewise, invalidated by the CTA.
“Thus, the CTA prohibited the government from collecting, in any manner, excise taxes and value-added tax on SHLPH’s Alkylate importations,” the PSPC said in a statement. SHLPH is the stock symbol of the oil firm.
Earlier, PSPC said it would pay under protest the P3.49 billion worth of excise taxes and VAT on fuel blending components used in its refinery for years 2014 to 2020 to the BOC.
“This will allow us to continue to provide to our customers and to the general public who rely on our products and mindful of the thousands of Filipinos whose livelihood depends on our ability to maintain our operations,” it said.
The payment is pursuant to the demand letter of the Port of Batangas in view of the dissolution by the Supreme Court (SC) of the Temporary Restraining Order (TRO) previously issued. The case was remanded to the CTA.
In July 2021, the SC lifted the TRO that barred the government from imposing taxes on the importation of the gasoline blending stock.
The case originated from a CTA case wherein the oil firm questioned the validity of documents from the Bureau of Customs’ Port of Batangas collector compelling it to pay P1.99 billion in “deficiency excise taxes, inclusive of interest and penalties, for its alkylate importations between January 2010 to June 2012.”