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BIR asked to defer VAT on toll fees


The Toll Regulatory Board (TRB) has asked the Bureau of Internal Revenue to delay the 12-percent value-added tax (VAT) on toll fees that will be imposed starting Thursday. "We requested the deferment of the VAT on tolls until after the Holy Week. After the Holy Week, the TRB will meet again and determine an official position on the VAT on tolls," Manuel G. Imperial, TRB executive director, said on Monday following a meeting with transport groups. The request will be reiterated in a Cabinet meeting today, he added. Transport groups "expressed concerns [such as] possible losses due to [a slowdown in] traffic," Imperial said. He also noted that the tax "is not part of the [government] contract with toll operators and is not part of the toll calculations." Last Friday, the BIR said the VAT on toll fees would be imposed starting April 1. That day is also Maundy Thursday in this year’s Lenten calendar, when a number of Filipino motorists troop out of the metropolis for a long weekend holiday. Based on the tax bureau’s order, the VAT on tolls will first be imposed on private vehicles. The government is expected to generate P2.5 billion from the tax yearly. BIR chief Joel L. Tan-Torres was not immediately available for comment. The VAT on tolls had been deferred since 2005, when the BIR released a circular that was supposed to enforce the tax, then at 10 percent. The agency issued another order last year that the Cabinet also shelved. On Sunday, TRB spokesman Julius G. Corpuz said the VAT on toll fees needed further study, warning of heavy traffic over the holiday weekend if it goes ahead. Corpuz said it would be difficult to adjust collection systems by April 1, especially since tollway operators must distinguish between public and private vehicles. The operator of the South Luzon Expressway also said the computation of VAT on toll fees would cause operational difficulties. The TRB has said it needed up to two weeks to study how to enforce the BIR order. — BusinessWorld

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