first planters pawnshop vs. cir

8/12/2019 First Planters Pawnshop vs. CIR

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Republic of the Philippines

Supreme Court

Manila

THIRD DIVISION

FIRST PLNT!RS "#R# No# $%&$'&

P(NSHOP) INC#) Petitioner, Present:

YNARES-SANTIAGO, J.,

Chairperson, - versus - AUSTRIA-MARTINEZ,

CHICO-NAZARIO,

NACHURA, and

REYES, JJ.COMMISSION!R OF

INT!RNL R!V!N*!) Promul!te": Res#on"ent$ %ul& '(, )((*

+ - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - +

D ! C I S I O N

*STRI+MRTIN!,) J .:

irst Pl!nters P!ns.o#, In/$ 0#etitioner1 /ontests t.e "e2i/ien/& v!lue-!""e" !n"

"o/ument!r& st!m# t!+es im#ose" u#on it 3& t.e 4ure!u o2 Intern!l Revenue 04IR1 2ort.e &e!r )((($ T.e /ore o2 #etitioner5s !rument is t.!t it is not ! len"in investor it.int.e #urvie o2 Se/tion 6(*0A1 o2 t.e N!tion!l Intern!l Revenue Co"e 0NIRC1, !s

!men"e", !n" t.ere2ore not su37e/t to v!lue-!""e" t!+ 08AT1$ Petitioner !lso /onten"s

t.!t ! #!n ti/9et is not su37e/t to "o/ument!r& st!m# t!+ 0ST1 3e/!use it is not #roo2o2 t.e #le"e tr!ns!/tion, !n" even !ssumin t.!t it is so, still, it is not su37e/t to t!+ sin/e

! "o/ument!r& st!m# t!+ is levie" on t.e "o/ument issue" !n" not on t.e tr!ns!/tion$

T.e 2!/ts:

In ! Pre-Assessment Noti/e "!te" %ul& ;, )((', #etitioner !s in2orme" 3& t.e

4IR t.!t it .!s !n e+istin t!+ "e2i/ien/& on its 8AT !n" ST li!3ilities 2or t.e &e!r)((($ T.e "e2i/ien/& !ssessment !s !t P<=6,6()$;> 2or 8AT !n" P)',?=?$'' 2or ST$

Petitioner #roteste" t.e !ssessment 2or l!/9 o2 le!l !n" 2!/tu!l 3!ses$

Petitioner su3se@uentl& re/eive" ! orm!l Assessment Noti/e on e/em3er )>,

)((', "ire/tin #!&ment o2 8AT "e2i/ien/& in t.e !mount o2 P<=6,6()$;> !n" ST

"e2i/ien/& in t.e !mount o2 P)=,;=;$6', in/lusive o2 sur/.!re !n" interest$ Petitioner



2ile" ! #rotest, .i/. !s "enie" 3& A/tin Reion!l ire/tor Anselmo G$ A"ri!no #er

in!l e/ision on is#ute" Assessment "!te" %!nu!r& )>, )((=$

Petitioner t.en 2ile" ! #etition 2or revie it. t.e Court o2 T!+ A##e!ls 0CTA1$

In ! e/ision "!te" M!& >, )((<, t.e )n" ivision o2 t.e CTA u#.el" t.e "e2i/ien/&

!ssessment$ Petitioner 2ile" ! motion 2or re/onsi"er!tion .i/. !s "enie" in !Resolution "!te" O/to3er ;, )((<$

Petitioner !##e!le" to t.e CTA En Banc .i/. ren"ere" ! e/ision "!te" %une ;,)((?, t.e "is#ositive #ortion o2 .i/. re!"s !s 2ollos:

HEREORE, #remises /onsi"ere", t.e Petition 2or Revie is .ere3&

ENIE 2or l!/9 o2 merit$ T.e !ss!ile" e/ision "!te" M!& >, )((< !n" Resolution"!te" O/to3er ;, )((< !re .ere3& AIRME$

SO ORERE$

Petitioner sou.t re/onsi"er!tion 3ut t.is !s "enie" 3& t.e CTA En Banc #er

Resolution "!te" Auust 6=, )((?$

Hen/e, t.e #resent #etition 2or revie un"er Rule =< o2 t.e Rules o2 Court 3!se"

on t.e 2olloin roun"s:

I

THE HONORA4BE COURT O TA APPEABS EN BANC GRA8EBY ERRE IN

INING PETITIONER BIA4BE OR 8AT$

II

THE HONORA4BE COURT O TA APPEABS EN BANC GRA8EBY ERRE INRUBING THAT PETITIONER IS BIA4BE OR ST ON PAN TICDETS$

T.e "etermin!tion o2 #etitioner5s t!+ li!3ilit& "e#en"s on t.e t!+ tre!tment o2 ! #!ns.o# 3usiness$ O""l&, t.ere .!s not 3een !n& "e2initive "e/l!r!tion in t.is re!r"

"es#ite t.e 2!/t t.!t #!ns.o#s .!ve lon 3een in e+isten/e$ All t.!t .!s 3een st!te" is

.!t #!ns.o#s !re not, 3ut not .!t #!ns.o#s !re$

T.e 4IR itsel2 .!s m!int!ine" !n !m3iv!lent st!n/e on t.is issue$ Initi!ll&, in Revenue

Memorandum Order No. 15-91 issue" on M!r/. 66, 6>>6, ! #!ns.o# 3usiness !s

/onsi"ere" !s !9in to len"in investorFs 3usiness !/tivit& !n" su37e/t to < #er/ent!et!+ 3einnin %!nu!r& 6, 6>>6, un"er Se/tion 66? o2 t.e T!+ Co"e o2 6>;;, !s !men"e"

3& E$O$ No$ );'$

it. t.e #!ss!e o2 Re#u3li/ A/t 0R$A$1 No$ ;;6? or t.e E8AT B! in 6>>=, t.e

4IR !3!n"one" its e!rlier #osition !n" m!int!ine" t.!t #!ns.o#s !re su37e/t to 6(

8AT, !s im#lemente" 3& Revenue Reul!tions No$ ;-><$ T.is !s /om#lemente" 3&

Revenue Memorandum Circuar No. !5-"1 "!te" O/to3er 6), )((6, .i/. #rovi"e" t.!t



T.e lev&, /olle/tion !n" !ssessment o2 t.e 6( 8AT !s 2urt.er "e2erre" 3&

R$A$ No$ *;?6 until e/em3er '6, )(((, !n" 3& R$A$ No$ >(6(, until e/em3er '6,

)(()J it. no 2urt.er "e2erments iven 3& l!, t.e lev&, /olle/tion !n" !ssessment

o2 t.e 6( 8AT on 3!n9s, non-3!n9 2in!n/i!l interme"i!ries, 2in!n/e /om#!nies, !n"

ot.er 2in!n/i!l interme"i!ries not #er2ormin @u!si-3!n9in 2un/tions ere 2in!ll& m!"ee22e/tive 3einnin %!nu!r& 6, )(('J

in!ll&, it. t.e en!/tment o2 R$A$ No$ >)'*, t.e servi/es o2 3!n9s, non-

3!n9 2in!n/i!l interme"i!ries, 2in!n/e /om#!nies, !n" ot.er 2in!n/i!l interme"i!ries not #er2ormin @u!si-3!n9in 2un/tions ere s#e/i2i/!ll& e+em#te" 2rom 8AT, !n" t.e ( to

< #er/ent!e t!+ on ross re/ei#ts on ot.er non-3!n9 2in!n/i!l interme"i!ries !s

reim#ose" un"er Se/tion 6)) o2 t.e T!+ Co"e o2 6>>;$

At t.e time o2 t.e "is#ute" !ssessment, t.!t is, 2or t.e &e!r )(((, #!ns.o#s ere

not su37e/t to 6( 8AT un"er t.e ener!l #rovision on s!le or e+/.!ne o2 servi/es !s

"e2ine" un"er Se/tion 6(*0A1 o2 t.e T!+ Co"e o2 6>>;, .i/. st!tes: 5 sae or e2chan'e

o+ services5 me!ns t.e #er2orm!n/e o2 !ll 9in"s o2 servi/es in t.e P.ili##ines 2or ot.ers2or ! 2ee, remuner!tion or /onsi"er!tion + + +$ Inste!", "ue to t.e s#e/i2i/ n!ture o2 its

3usiness, #!ns.o#s ere t.en su37e/t to 6( 8AT un"er t.e /!teor& o2 non-3!n92in!n/i!l interme"i!ries, !s #rovi"e" in t.e s!me Se/tion 6(*0A1, .i/. re!"s:

SEC$ 6(*$ 4aue-added $a2 on ae o+ ervices and 6se or ease o+ (roper&ies.

-

0A1 Ra&e and Base o+ $a2. - T.ere s.!ll 3e levie", !ssesse" !n" /olle/te", !

v!lue-!""e" t!+ e@uiv!lent to ten #er/ent 06(1 o2 ross re/ei#ts "erive" 2rom t.e s!le or

e+/.!ne o2 servi/es, in/lu"in t.e use or le!se o2 #ro#erties$ T.e #.r!se 7sae or e2chan'e o+ services7 me!ns t.e #er2orm!n/e o2 !ll 9in"s

or servi/es in t.e P.ili##ines 2or ot.ers 2or ! 2ee, remuner!tion or /onsi"er!tion,

in/lu"in + + + ser-ices of ban.s) non+ban. financial interme/iaries an/ finance

companiesJ !n" non-li2e insur!n/e /om#!nies 0e+/e#t t.eir /ro# insur!n/es1, in/lu"in

suret&, 2i"elit&, in"emnit& !n" 3on"in /om#!niesJ !n" simil!r servi/es re!r"less o2

.et.er or not t.e #er2orm!n/e t.ereo2 /!lls 2or t.e e+er/ise or use o2 t.e #.&si/!l orment!l 2!/ulties$ T.e #.r!se 5s!le or e+/.!ne o2 servi/es5 s.!ll li9eise in/lu"e: + + +

0Em#.!sis !n" un"ers/orin su##lie"1

T.e t!+ tre!tment o2 #!ns.o#s !s non-3!n9 2in!n/i!l interme"i!ries is notit.out 3!sis$

R$A$ No$ '';, !s !men"e", or t.e Gener!l 4!n9in A/t /.!r!/teries t.e terms%an8in' ins&i&u&ion !n" %an8 !s s&non&mous !n" inter/.!ne!3le !n" s#e/i2i/!ll& in/lu"e

/ommer/i!l 3!n9s, s!vins 3!n9, mort!e 3!n9s, "evelo#ment 3!n9s, rur!l 3!n9s, sto/9

s!vins !n" lo!n !sso/i!tions, !n" 3r!n/.es !n" !en/ies in t.e P.ili##ines o2 2orein 3!n9s$ R$A$ No$ *;>6 or t.e Gener!l 4!n9in B! o2 )(((, me!n.ile, #rovi"e" t.!t

%an8s s.!ll re2er to entities en!e" in t.e len"in o2 2un"s o3t!ine" in t.e 2orm o2

"e#osits$ R$A$ No$ *;>6 !lso in/lu"e" /oo#er!tive 3!n9s, Isl!mi/ 3!n9s !n" ot.er 3!n9s



!s "etermine" 3& t.e Monet!r& 4o!r" o2 t.e Ban'8o en&ra n' (iipinas in t.e

/l!ssi2i/!tion o2 3!n9s$

inancia in&ermediaries, on t.e ot.er .!n", !re "e2ine" !s #ersons or entities

.ose #rin/i#!l 2un/tions in/lu"e t.e len"in, investin or #l!/ement o2 2un"s or

evi"en/es o2 in"e3te"ness or e@uit& "e#osite" it. t.em, !/@uire" 3& t.em, or ot.erise/ourse" t.rou. t.em, eit.er 2or t.eir on !//ount or 2or t.e !//ount o2 ot.ers$

It nee" not 3e el!3or!te" t.!t #!ns.o#s !re non-3!n9sL3!n9in institutions$Moreover, t.e n!ture o2 t.eir 3usiness !/tivities #!rt!9es t.!t o2 ! 2in!n/i!l interme"i!r&

in t.!t its #rin/i#!l 2un/tion is len"in$

A #!ns.o#5s 3usiness !n" o#er!tions !re overne" 3& Presi"enti!l e/ree 0P$$1 No$66= or t.e P!ns.o# Reul!tion A/t !n" Centr!l 4!n9 Cir/ul!r No$ ';= 0Rules !n"

Reul!tions 2or P!ns.o#s1$ Se/tion ' o2 P$$ No$ 66= "e2ines pa)nshop !s ! #erson or

entit& en!e" in t.e 3usiness o2 len"in mone& on #erson!l #ro#ert& "elivere" !s

se/urit& 2or lo!ns !n" s.!ll 3e s&non&mous, !n" m!& 3e use" inter/.!ne!3l&, it. #!n3ro9er or #!n 3ro9er!e$

T.!t #!ns.o#s !re to 3e tre!te" !s non-3!n9 2in!n/i!l interme"i!ries is 2urt.er

3olstere" 3& t.e 2!/t t.!t #!ns.o#s !re un"er t.e reul!tor& su#ervision o2 t.e Ban'8o

en&ra n' (iipinas !n" /overe" 3& its M!nu!l o2 Reul!tions 2or Non-4!n9 in!n/i!lInstitutions$ T.e M!nu!l in/lu"es #!ns.o#s in t.e list o2 non-3!n9 2in!n/i!l

interme"i!ries, vi $:

=6(6K$6 inancia *n&ermediaries + + +

Non-3!n9 2in!n/i!l interme"i!ries s.!ll in/lu"e t.e 2olloin:

061 A #erson or entit& li/ense" !n"Lor reistere" it. !n& overnmentreul!tor& 3o"& !s ! non-3!n9 2in!n/i!l interme"i!r&, su/. !s investment .ouse,

investment /om#!n&, 2in!n/in /om#!n&, se/urities "e!lerL3ro9er, len"in investor,

pa0nshop, mone& 3ro9er + + +$ 0Em#.!sis su##lie"1

Revenue Re'ua&ions No. 1"-/""!, in 2!/t, re/onie" t.ese 3!ses, to it:

SEC$ )$ 4ASES O KUABIYING PANSHOPS AS NON-4ANDINANCIAB INTERMEIARIES$ - .ere!s, in rel!tion to Se/$ )$' o2 Rev$ Res No$ >-

)((= "e2inin Non-3!n9 in!n/i!l Interme"i!ries, t.e term #!ns.o# !s "e2ine"

un"er Presi"enti!l e/ree No$ 66= .i/. !ut.orie" its /re!tion, &o %e a person or en&i&;en'a'ed in &he %usiness o+ endin' mone;, !ll 2!ll it.in t.e /l!ssi2i/!tion o2 Non-3!n9

in!n/i!l Interme"i!ries !n" t.ere2ore, /overe" 3& Se/$ = o2 R$A$ No$ >)'*$

T.is /l!ssi2i/!tion is e@u!ll& su##orte" 3& Su3se/tion =6(6K$6 o2 t.e 4SPM!nu!l o2 Reul!tions 2or Non-4!n9 in!n/i!l Interme"i!ries !n" reiter!te" in 4SP

Cir/ul!r No$ )(=->>, /l!ssi2&in #!ns.o#s !s one o2 Non-3!n9 in!n/i!l Interme"i!ries

it.in t.e su#ervision o2 t.e 4!n9o Sentr!l n Pili#in!s$



Ultim!tel&, R$A$ No$ >)'* /!teori/!ll& /on2irme" t.e /l!ssi2i/!tion o2

#!ns.o#s !s non-3!n9 2in!n/i!l interme"i!ries$

Comin no to t.e issue !t .!n" - Sin/e #etitioner is ! non-3!n9 2in!n/i!l

interme"i!r&, it is su37e/t to 6( 8AT 2or t.e t!+ &e!rs 6>>? to )(()J ho0e-er) 0ith the

le-1) assessment an/ collection of VT from non+ban. financial interme/iaries bein2specificall1 /eferre/ b1 la0, then petitioner is not liable for VT /urin2 these ta3

1ears$ 4ut it. t.e 2ull im#lement!tion o2 t.e 8AT s&stem on non-3!n9 2in!n/i!l

interme"i!ries st!rtin %!nu!r& 6, )((', #etitioner is li!3le 2or 6( 8AT 2or s!i" t!+ &e!r$An" 3einnin )((= u# to t.e #resent, 3& virtue o2 R$A$ No$ >)'*, #etitioner is no loner

li!3le 2or 8AT 3ut it is su37e/t to #er/ent!e t!+ on ross re/ei#ts 2rom ( to < , !s t.e

/!se m!& 3e$

B!stl&, #etitioner is li!3le 2or "o/ument!r& st!m# t!+es$

T.e Court .!s settle" t.is issue in Miche J. huiier (a)nshop, *nc. v.

Commissioner o+ *n&erna Revenue, in .i/. it !s rule" t.!t t.e su37e/t o2 ST is notlimite" to t.e "o/ument !lone$ Ple"e, .i/. is !n e+er/ise o2 ! #rivilee to tr!ns2er

o3li!tions, ri.ts or #ro#erties in/i"ent t.ereto, is !lso su37e/t to ST, t.us + + + t.e su37e/t o2 ! ST is not limite" to t.e "o/ument em3o"&in t.e

enumer!te" tr!ns!/tions$ A ST is !n e+/ise t!+ on t.e e+er/ise o2 ! ri.t or #rivilee to

tr!ns2er o3li!tions, ri.ts or #ro#erties in/i"ent t.ereto$ In (hiippine #ome Assurance

Corpora&ion v. Cour& o+ Appeas, it !s .el" t.!t:

+ + + +

Ple"e is !mon t.e #rivilees, t.e e+er/ise o2 .i/. is su37e/t to ST$ A

#le"e m!& 3e "e2ine" !s !n !//essor&, re!l !n" unil!ter!l /ontr!/t 3& virtue o2 .i/. t.e"e3tor or ! t.ir" #erson "elivers to t.e /re"itor or to ! t.ir" #erson mov!3le #ro#ert& !s

se/urit& 2or t.e #er2orm!n/e o2 t.e #rin/i#!l o3li!tion, u#on t.e 2ul2illment o2 .i/. t.e

t.in #le"e", it. !ll its !//essions !n" !//essories, s.!ll 3e returne" to t.e "e3tor or tot.e t.ir" #erson$ T.is is essenti!ll& t.e 3usiness o2 #!ns.o#s .i/. !re "e2ine" un"er

Se/tion ' o2 Presi"enti!l e/ree No$ 66=, or t.e P!ns.o# Reul!tion A/t, !s #ersons or

entities en!e" in len"in mone& on #erson!l #ro#ert& "elivere" !s se/urit& 2or lo!ns$ Se/tion 6) o2 t.e P!ns.o# Reul!tion A/t !n" Se/tion )6 o2 t.e Rules !n"

Reul!tions or P!ns.o#s issue" 3& t.e Centr!l 4!n9 to im#lement t.e A/t, re@uire

ever& #!ns.o# or #!n3ro9er to issue, !t t.e time o2 ever& su/. lo!n or #le"e, !

memor!n"um or ti/9et sine" 3& t.e #!n3ro9er !n" /ont!inin t.e 2olloin "et!ils:061 n!me !n" resi"en/e o2 t.e #!nerJ 0)1 "!te t.e lo!n is r!nte"J 0'1 !mount o2

#rin/i#!l lo!nJ 0=1 interest r!te in #er/entJ 0<1 #erio" o2 m!turit&J 0?1 "es/ri#tion o2 #!nJ

0;1 sin!ture o2 #!n3ro9er or .is !ut.orie" !entJ 0*1 sin!ture or t.um3 m!r9 o2 #!ner or .is !ut.orie" !entJ !n" 0>1 su/. ot.er terms !n" /on"itions !s m!& 3e !ree"

u#on 3eteen t.e #!n3ro9er !n" t.e #!ner$ In !""ition, Centr!l 4!n9 Cir/ul!r No$

==<, #res/ri3e" ! st!n"!r" 2orm o2 #!n ti/9ets it. entries 2or t.e re@uire" "et!ils on its2!/e !n" t.e m!n"!te" terms !n" /on"itions o2 t.e #le"e !t t.e "ors!l #ortion t.ereo2$

Se/tion ' o2 t.e P!ns.o# Reul!tion A/t "e2ines ! #!n ti/9et !s 2ollos:

+ + + +



True, t.e l! "oes not /onsi"er s!i" ti/9et !s !n evi"en/e o2 se/urit& or

in"e3te"ness$ Hoever, 2or #ur#oses o2 t!+!tion, t.e s!me #!n ti/9et is #roo2 o2 !n

e+er/ise o2 ! t!+!3le #rivilee o2 /on/lu"in ! /ontr!/t o2 #le"e$ At !n& r!te, it is nots!i" ti/9et t.!t /re!tes t.e #!ns.o#Fs o3li!tion to #!& ST 3ut t.e e+er/ise o2 t.e

#rivilee to enter into ! /ontr!/t o2 #le"e$ T.ere is t.ere2ore no 3!sis in #etitionerFs

!ssertion t.!t ! ST is liter!ll& ! t!+ on ! "o/ument !n" t.!t no t!+ m!& 3e im#ose" on ! #!n ti/9et$

T.e settle" rule is t.!t t!+ l!s must 3e /onstrue" in 2!vor o2 t.e t!+#!&er !n"

stri/tl& !!inst t.e overnmentJ !n" t.!t ! t!+ /!nnot 3e im#ose" it.out /le!r !n"e+#ress or"s 2or t.!t #ur#ose$ T!9in our 3e!rin 2rom t.e 2oreoin "o/trines, e

s/rutinie" Se/tion 6>< o2 t.e NIRC, 3ut t.ere is no !& t.!t s!i" #rovision m!& 3e

inter#rete" in 2!vor o2 #etitioner$ Se/tion 6>< un4ualifie/l1 sub5ects all ple/2es to ST$

It st!tes t.!t oQn ever; 2 2 2 ped'e 2 2 2 &here sha %e coec&ed a documen&ar; s&amp&a2 2 2 2. It is /le!r, /!teori/!l, !n" nee"s no 2urt.er inter#ret!tion or /onstru/tion$ T.e

e+#li/it tenor t.ereo2 re@uires .!r"l& !n&t.in t.!n ! sim#le !##li/!tion$

+ + + +

In t.e inst!nt /!se, t.ere is no l! s#e/i2i/!ll& !n" e+#ressl& e+em#tin #le"esentere" into 3& #!ns.o#s 2rom t.e #!&ment o2 ST$ Se/tion 6>> o2 t.e NIRC

enumer!te" /ert!in "o/uments .i/. !re not su37e/t to st!m# t!+J 3ut ! #!ns.o# ti/9etis not one o2 t.em$ Hen/e, #etitionerFs ne3ulous /l!im t.!t it is not su37e/t to ST is

it.out merit$ It /!nnot 3e over-em#.!sie" t.!t t!+ e+em#tion re#resents ! loss o2

revenue to t.e overnment !n" must, t.ere2ore, not rest on v!ue in2eren/e$ E+em#tion2rom t!+!tion is never #resume"$ or t!+ e+em#tion to 3e re/onie", t.e r!nt must 3e

/le!r !n" e+#ressJ it /!nnot 3e m!"e to rest on "ou3t2ul im#li/!tions$

Un"er t.e #rin/i#le o2 s&are decisis e& non <uie&a movere 02ollo #!st #re/e"ents!n" "o not "istur3 .!t .!s 3een settle"1, on/e ! /!se .!s 3een "e/i"e" one !&, !n&

ot.er /!se involvin e+!/tl& t.e s!me #oint !t issue, !s in t.e /!se !t 3!r, s.oul" 3e

"e/i"e" in t.e s!me m!nner$

(H!R!FOR!, t.e #etition is PRTILL6 "RNT!D$ T.e e/ision "!te"

%une ;, )((? !n" Resolution "!te" Auust 6=, )((? o2 t.e Court o2 T!+ A##e!ls En Banc is MODIFI!D to t.e e22e/t t.!t t.e 4ure!u o2 Intern!l Revenue !ssessment 2or 8AT

"e2i/ien/& in t.e !mount o2 P<=6,6()$;> 2or t.e &e!r )((( is R!V!RS!D an/ S!T

SID!, .ile its !ssessment 2or ST "e2i/ien/& in t.e !mount o2 P)=,;=;$6', in/lusive

o2 sur/.!re !n" interest, is *PH!LD$

SO ORD!R!D$

M# LICI *STRI+MRTIN!,

Asso/i!te %usti/e



E CONCUR:

CONS*!LO 6NR!S+SNTI"O

Asso/i!te %usti/eC.!ir#erson

MINIT V# CHICO+N,RIO

Asso/i!te %usti/eNTONIO !D*RDO 7# NCH*R

Asso/i!te %usti/e

R*7!N T# R!6!S

Asso/i!te %usti/e

TT!STTION

I !ttest t.!t t.e /on/lusions in t.e !3ove e/ision .!" 3een re!/.e" in

/onsult!tion 3e2ore t.e /!se !s !ssine" to t.e riter o2 t.e o#inion o2 t.e CourtFs

ivision$

CONS*!LO 6NR!S+SNTI"O

Asso/i!te %usti/e

C.!ir#erson, T.ir" ivision

C!RTIFICTION

Pursu!nt to Se/tion 6', Arti/le 8III o2 t.e Constitution, !n" t.e ivision C.!ir#ersonFs

Attest!tion, it is .ere3& /erti2ie" t.!t t.e /on/lusions in t.e !3ove e/ision .!" 3een

re!/.e" in /onsult!tion 3e2ore t.e /!se !s !ssine" to t.e riter o2 t.e o#inion o2 t.eCourtFs ivision$

R!6NTO S# P*NO



C.ie2 %usti/e

Roo, Anne+ C, #$ *=$

I"$, Anne+ , ##$ *<->($ I"$, Anne+ E, ##$ >6-><$

I"$, Anne+ , ##$ >?-6(;$

I"$, Anne+ G, #$ 6(*$ I"$, Anne+ H, ##$ 6(>-6))$

I"$, Anne+ I, ##$ 6<(-6?*$

I"$, Anne+ %, ##$ 6?>-6*'$ I"$, Anne+ D, ##$ 6*=-6**$

I"$ !t *($

Roo, ##$ *)-*'$

I"$ !t '=$ As /l!ri2ie" 3& 4IR Revenue Memor!n"um Cir/ul!r No$ ='->6 issue" on

M!& );, 6>>6$

Entitle", An A/t Restru/turin t.e 8!lue-A""e" T!+ 08AT1 S&stem,

i"enin its T!+ 4!se !n" En.!n/in its A"ministr!tion, !n" 2or t.ese #ur#osesAmen"in !n" Re#e!lin t.e Relev!nt Provisions o2 t.e N!tion!l Intern!l Revenue Co"e,

!s !men"e", !n" 2or Ot.er Pur#oses$ C$T$A$ C!se No$ ?>6<, A#ril 66, )((=$

C$T$A$ C!se No$ ;(?>, %une 6;, )((<$

G$R$ No$ 6<(>=;, %ul& 6<, )((', =(? SCRA 6;*$ Penne" 3& C.ie2 %usti/eHil!rio G$ !vi"e, %r$ it. t.e /on/urren/e o2 Asso/i!te %usti/es %ose 8itu, Consuelo

Yn!res-S!nti!o, Antonio T$ C!r#io !n" A"ol2o S$ A/un!$

I"$ !t 6*<$

2t#:LL2t#$3ir$ov$#.Le3!"min6L#"2L6**;rm/'?(=$#"2$ Re#u3li/ A/t 0R$A$1 No$ >)'* l!#se" into l! on e3ru!r& (<, )((= it.out

t.e sin!ture o2 t.e Presi"ent, in !//or"!n/e it. Arti/le 8I, Se/tion ); 061 o2 t.e

Constitution$ Presi"enti!l e/ree No$ 66<*$

E22e/tive M!& )*, 6>>=$

T.e im#lement!tion o2 t.e 8AT s&stem un"er R$A$ No$ ;;6? !s m!"ee22e/tive %!nu!r& 6, 6>>? 0see Commissioner o+ *n&erna Revenue v. (hiippine =o%a

Communica&ions, *nc., G$R$ No$ 6==?>?, Auust 6?, )((?, =>> SCRA <'1$

A##rove" on e/em3er )(, 6>>?$

R$A$ No$ *)=6, Se/tion 66 #rovi"es: SEC$ 66$ Se/tion 6; o2 Re#u3li/ A/t No$ ;;6? is .ere3& !men"e"

to re!" !s 2ollos:

EC$ 6;$ E++ec&ivi&; o+ &he *mposi&ion o+ 4A$ on Cer&ain =oods, (roper&ies and ervices$ T.e v!lue-!""e" t!+ s.!ll 3e levie", !ssesse" !n" /olle/te" on t.e 2olloin

tr!ns!/tions, st!rtin %!nu!r& 6, 6>>*:

+ + + +031 Servi/es ren"ere" 3& 3!n9s, non-3!n9 2in!n/i!l interme"i!ries, 2in!n/e /om#!nies

!n" ot.er 2in!n/i!l interme"i!ries not #er2ormin @u!si-3!n9in 2un/tionsJ

+ + + +:



R$A$ No$ *=)= ren!me" t.e N!tion!l Intern!l Revenue Co"e o2 6>;; to

N!tion!l Intern!l Revenue Co"e o2 6>>;, or t.e T!+ Co"e o2 6>>;, !n" too9 e22e/t on

%!nu!r& 6, 6>>*$ R$A$ No$ *=)*, Se/tion < #rovi"es:

SEC$ <$ $ransi&or; (rovisions. - e2erment o2 t.e

E22e/tivit& o2 t.e Im#osition o2 8AT on Cert!in Servi/es$ - T.e e22e/tivit& o2 t.eim#osition o2 t.e v!lue-!""e" t!+ on servi/es !s #res/ri3e" in Se/tion 6;0!1 !n" 031 o2

Re#u3li/ A/t No$ ;?6?, !s !men"e" 3& Re#u3li/ A/t$ *)=6, is .ere3& 2urt.er "e2erre"

until e/em3er '6, 6>>>, unless Conress "eems ot.erise: (rovided, T.!t t.e s!i"servi/es s.!ll /ontinue to #!& t.e !##li/!3le t!+ #res/ri3e" un"er t.e #resent #rovisions

o2 t.e N!tion!l Intern!l Revenue Co"e, !s !men"e"$

R$A$ No$ >)'*, Se/tion ) #rovi"es:

SEC$ )$ Se/tion 6(> o2 t.e s!me Co"e is .ere3& !men"e" 3&reor"in #!r!r!#. 061 !n" insertin !""ition!l #!r!r!#.s !2ter 01 .i/. s.!ll no

re!" !s 2ollos:

SEC$ 6(>$ E2emp& $ransac&ions. > T.e 2olloin s.!ll 3e

e+em#t 2rom t.e v!lue-!""e" t!+:+ + + +

0!!1 Servi/es o2 3!n9s, non-3!n9 2in!n/i!l interme"i!ries #er2ormin @u!si-3!n9in 2un/tions, !n" ot.er non-3!n9 2in!n/i!l interme"i!riesJ

+ + + +

T.e 2oreoin e+em#tions to t.e /ontr!r& notit.st!n"in,!n& #erson .ose s!le o2 oo"s or #ro#erties or servi/es .i/. !re ot.erise not su37e/t

to 8AT, 3ut .o issue ! 8AT invoi/e or re/ei#t t.ere2or s.!ll, in !""ition!l to .is li!3ilit&

to ot.er !##li/!3le #er/ent!e t!+, i2 !n&, 3e li!3le to t.e t!+ im#ose" in Se/tion 6(? or

6(* it.out t.e 3ene2it o2 in#ut t!+ /re"it, !n" su/. t!+ s.!ll !lso 3e re/onie" !s in#utt!+ /re"it to t.e #ur/.!ser un"er Se/tion 66(, !ll o2 t.is Co"e$

R$A$ No$ >)'*, Se/tion = re!"s:

Se/tion =$ Se/tion 6)) o2 t.e N!tion!l Intern!l RevenueCo"e o2 6>>;, !s !men"e", is .ere3& restore" it. !men"ments to re!" !s 2ollos:

Se/$ 6))$ $a2 on O&her Non-Ban8 inancia *n&ermediaries$ > T.ere s.!ll

3e /olle/te" ! t!+ o2 2ive #er/ent 0<1 on t.e ross re/ei#ts "erive" 3& ot.er non-3!n92in!n/i!l interme"i!ries "oin 3usiness in t.e P.ili##ines, 2rom interest, /ommissions,

"is/ounts !n" !ll ot.er items tre!te" !s ross in/ome un"er t.is /o"e: (rovided , t.!t

interests, /ommissions !n" "is/ounts 2rom len"in !/tivities, !s ell !s in/ome 2rom

2in!n/i!l le!sin, s.!ll 3e t!+e" on t.e 3!sis o2 rem!inin m!turities o2 t.e instruments2rom .i/. su/. re/ei#ts !re "erive", in !//or"!n/e it. t.e 2olloin s/.e"ule:

m!turit& #erio" is 2ive 0<1 &e!rs or less$$$$$$$$$$$$$$$$$$$$$$$ <

m!turit& #erio" is more t.!n 2ive 0<1 &e!rs$$$$$$$$$$$$$$$$$$6 (rovided , ho)ever , t.!t in /!se t.e m!turit& #erio" is s.ortene" t.ru

#retermin!tion, t.en t.e m!turit& #erio" s.!ll 3e re/9one" to en" !s o2 t.e "!te o2

#retermin!tion 2or #ur#oses o2 /l!ssi2&in t.e tr!ns!/tion !n" t.e /orre/t r!te s.!ll 3e!##lie" !//or"inl&$

(rovided , +ina;, t.!t t.e ener!ll& !//e#te" !//ountin #rin/i#les !s m!&

3e #res/ri3e" 3& t.e Se/urities !n" E+/.!ne Commission 2or ot.er non-3!n9 2in!n/i!l

interme"i!ries s.!ll li9eise 3e t.e 3!sis 2or t.e /!l/ul!tion o2 ross re/ei#ts$



Not.in in t.is /o"e s.!ll #re/lu"e t.e Commissioner 2rom im#osin t.e

s!me t!+ .erein #rovi"e" on #ersons #er2ormin simil!r 2in!n/in !/tivities$

Se/tion )$ Se/tion '$6$

Se/tion '$6 0e1, 021, !n" 01$

Gener!l 4!n9in A/t, Se/tion )-0/1J M!nu!l o2 Reul!tions 2or Non-4!n9in!n/i!l Institutions, =6(6K$6$

See #!es ;-* o2 t.is e/ision$

G$R$ No$ 6??;*?, M!& ', )((?, =*> SCRA 6=;$ Commissioner o+ *n&erna Revenue v. $rus&)or&h; (a)nshop, *nc., G$R$ No$

6=>*'=, M!& ), )((?, =** SCRA <'*, <=<$

first planters pawnshop vs. cir

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