Atty. Fermo B. Avila II

8 posts

Modus operandi: Barefaced robbery in the collection of real property taxes

DO you own real property in the Philippines? Do you have an employee-representative entrusted to remit tax payments to the local government unit? What if I told you that your real property could be auctioned off and sold, without your knowledge, because your trusted employee failed to remit the tax payments to the LGU and appeared to have absconded with the money instead?

Violation of due process: An inexistent assessment bears no fruit

Mother Nature has her methods of transforming things. A seed becomes a tree, which, in turn, bears fruits. The seed undergoes certain processes, such as germination and photosynthesis, until it becomes a fruit-bearing tree. When its fruits mature, some or all of its fruits are harvested and eaten, either by animals or by humans. The fruits eaten by animals are secreted, thereby planting a new generation of seedlings, a process that eventually leads back to the seed-to-fruit cycle.

Proposed Philippine Federal Constitution: Innovations in taxation

The advent of Charter change is at hand. Several attempts to amend or revise the 1987 Philippine Constitution have been made during the past administrations. But none of them were as close to amending the Constitution as the present one. President Duterte’s political will to shift our form of government to federalism is the strongest it has ever been. And as the third regular session of the 17th Congress of the Philippines recently opened, the probability of modifying the Constitution is at its peak. Thus, a preview of the following innovative provisions in the proposed draft of the Federal Constitution (hereinafter referred as the “draft”) about taxation shall provide a better understanding of what’s to come.

Income-tax holiday: Delineating the jurisdictions of the BIR and BOI

The word “holiday” connotes a break, leave or a day off. More often than not, it brings pleasant perceptions, especially when used in conjunction with “income tax”. In the Philippines, an income-tax holiday (ITH) is basically a break from the payment of income tax levied by the national government for a certain period of time. It is a fiscal incentive given to an entity (also referred to as a “registered enterprise”) that complies with the conditions required under Executive Order (EO) 226, otherwise known as the Omnibus Investments Code of 1987, and is given in relation to the entity’s registered activities.

Pay up first! A real-property tax story

AN owner of a real property, or a person having interest therein, is liable for the payment of real-property taxes. While being an owner, or being a person having interest, he will receive an assessment from the assessment and treasury office of a city or municipality. He may, however, disagree or question such assessment if he finds that it was unreasonable, incorrect, or illegal.

Proving VAT zero-rated sale of services

Services performed in the Philippines by a value-added tax (VAT)-registered domestic corporation to a nonresident foreign corporation can be subject to VAT at a rate of zero percent. As these services yield a zero output VAT liability, the input VAT, which are attributable to such services, incurred by the domestic corporation can be the subject of a claim for tax credit or refund. And in claiming a tax credit or refund, the domestic corporation must prove, among others, that the sale of services is VAT zero-rated.