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TAX and
finance officials have put the issue of taxability of
the nation’s toll ways under a quick but exhaustive
legal study, including whether the toll operators should
be made to pay retroactive value-added tax (VAT).
Should
the toll operators be found VATable, they stand to pay
at least P11 billion based on data collated by the
Department of Finance (DOF) that around P1 billion a
year should have been collected from them.
The law
expanding the VAT net took effect in 1996.
Finance
Secretary Margarito Teves has directed legal minds at
the Bureau of Internal Revenue (BIR) and the DOF to
conduct a thorough evaluation of the VATability of toll
operators who claim to be VAT-exempt, Finance
Undersecretary Gaudencio Mendoza said Tuesday in an
interview.
“The
whole issue of VAT operations is [the] subject of the
study. Secretary Teves wants it completed soon because
of its immediate public impact,” Mendoza said.
The
joint DOF-BIR study was to be “complete, in the sense
that the history of the law, what the law actually says
and the positions of both the DOF and the BIR on the
matter,” according to
Mendoza.
At the
moment, he clarified, the DOF and the BIR have not taken
a legal position yet on the VATability of toll ways one
way or the other.
What is
clear is that the commissioner of the BIR has “exclusive
authority to interpret the tax code subject to review by
the secretary of finance,” Mendoza added.
Earlier,
Sen. Ralph Recto, who helped craft the legislation that
expanded the VAT net and raised the rate to 12 percent,
claimed the toll ways operators should have paid the VAT
but have not done so.
Toll
operators, in turn, argued they are VAT-exempt entities
based on the absence of explicit provisions in the law.
At this
point, industry sources point out, it is not clear
whether or not VAT has actually been imputed in charges
levied on motorists using existing toll ways such as the
North Luzon Expressway or its South Luzon counterpart.
Undersecretary Mendoza reiterated this particular issue
has been put under close scrutiny whose results should
be out very soon.
He
refused to put a time frame for completing the legal
study, saying only that public interest dictates this
should be done “as completely and as quickly as
possible.” |
