DEPARTMENT OF FINANCE

 

The Department of Finance issued Revenue Regulations (RR) No. 07-2017, 26 October 2017, to amend Section 2.57.2 (T) of RR No. 02-1998, as amended and Sections 3 (c) and 4 of RR No. 06-2012. The Bangko Sentral ng Pilipinas (BSP) is obliged to withhold (creditable withholding tax) on gross income payments on purchases of minerals, mineral products and quarry resources as defined and discussed in Section 151 of the National Internal Revenue Code (NIRC), as amended. The rate of creditable withholding tax which the BSP is obliged to withhold on the said income payments has been reduced from five percent (5%) to one percent (1%).The RR shall take effect immediately.

(RGM&Co. Note: The RR was published on 25 November 2017 in the Manila Bulletin).

 

BUREAU OF INTERNAL REVENUE

 

The Bureau of Internal Revenue (BIR) issued the following:

Revenue Memorandum Circular (RMC) No. 95-2017, 16 November 2017, providing guidelines on proper treatment of Government Securities Repurchase Program (GS Repo Program) governed by the Global Master Repurchase Agreement (GMRA).

Jointly spearheaded by the Bureau of Treasury (BTr), the BSP and the Securities and Exchange Commission (SEC) and supported by the Bankers Association of the Philippines and the Money Market Association of the Philippines, the GS Repo Program provides for the creation of an Interdealer Government Bond Repo Market with counterparties to initially include Government Eligible Securities Dealers or GSEDs. This program will cover Philippine Peso-denominated Treasury bills and Treasury Bonds issued by the BTr, for and on behalf of the Republic of the Philippines. The Repo shall be governed by the terms of the GMRA, a repo master agreement developed jointly by the Securities Industry and Financial Markets Association (SIFMA) and the International Capital Market Association (ICMA) and internationally accepted as the market standard in non-dollar markets.

Below is the table showing the tax treatment of the transactions:

Taxable Items	Tax Applied	Tax Rate
Repo Transaction	Documentary Stamp	Exempted
Repo Rate	Final Withholding Tax	20%
	GRT	Applicable rates under Section 121 or 122 of the NIRC, as amended
Mark to Market Gain or Loss, and any other realized gain (from subsequent sale of Repo Securities within the period)	Corporate Income Tax	30%
	GRT	Applicable rates under Section 121 or 122 of the NIRC, as amended

 

The RMC also provides for the reportorial requirements of the BIR for the participating GSEDs.

Please refer to the full text of the RMC for the detailed guidelines.

Revenue Memorandum Order (RMO) No. 32-2017, 27 November 2017, to amend RMO No. 51-2010 in order to clarify, revise and update certain policies, guidelines and procedures in handling grievances or complaints in the eComplaint System.

The eComplaint System is an electronic system where taxpayers may report and express their grievances and complaint/s to the BIR through an email facility, the BIR website or portal.

Please refer to the full text of the RMO for the detailed guidelines and procedures of the eComplaint System.

 

Annex A_RMC 95-2017

Revenue Memorandum Circular No. 95-2017

Revenue Memorandum Order No. 32-2017

Revenue Regulations No. 7-2017