BIR Ruling [DA-201-97]

May 13, 1997 BIR RULING [DA-201-97] Monte de Piedad & Savings Bank E. Rodriguez Sr. Ave. cor. Monte de Piedad St. Cubao, Quezon City Attention: Mr . Victor B . Sarabia Vice-President Gentlemen : This refers to your letter dated April 25, 1997 requesting for the waiver of the surcharge and interest imposed due to the non-remittance of the taxes deducted and withheld by you on interest paid on bank deposits and yield on deposit substitutes as well as expanded withholding taxes for the calendar quarter ending March 31, 1997. It appears that on April 23, 1997, the Bangko Sentral ng Pilipinas, thru its Monetary Board, instructed you to immediately stop and desist from issuing Manager's Checks including all other forms of withdrawals in any form or to any persons or entity. A copy of this directive was submitted to our Office for our guidance. In reply thereto, please be informed that under Sections 248 (a)(1) and (3) and 249, both of the Tax Code, as amended, the imposition of the surcharge and interest on delinquency is mandatory. Strong reasons of policy support a strict observance of the rule regarding the payment of tax. The laws imposing penalties for delinquencies are clearly intended to hasten tax payments or punish evasions or neglect of duty in respect thereof. If delays in tax payments are to be condoned for light reasons, the law imposing penalties for delinquencies would be rendered nugatory and the maintenance of the government and its multifarious activities would be as precarious as taxpayers are willing or unwilling to pay their obligations to the state on time (Jamora vs. Meer, 74 Phil. 22) However, in view of the exceptional circumstances which justifies your non-remittance of the taxes deducted and withheld by you on interest on bank deposits and yield on deposit substitutes as well as expanded withholdings taxes within the time specified under Revenue Regulations No. 5-85 as amended by Revenue Regulations No. 3-93, your request for the waiver of the surcharge and interest is hereby granted. Very truly yours, LIWAYWAY VINZONS-CHATO Commissioner of Internal Revenue