Denial of Request for Waiver of Surcharges and Penalties Due to Late Payment of Fringe Benefits Tax Liability

September 11, 2000 BIR RULING NO. 039-00 Secs. 248 & 249-000-00 Boart Longyear Inc. Rm. M-103 Eastgate Centre Building 169 EDSA Mandaluyong City Attention: Ms . Flora B . Cordero Gentlemen : This refers to your letter dated October 29, 1998 requesting for the waiver of the surcharges and penalties imposed on you due to late payment of your fringe benefits tax liability for the first and second quarters of 1998. It is represented that your company has its principal office at Rm. M-103, Eastgate Center Bldg., 169 EDSA, Mandaluyong City and registered with the BIR with Tax Identification No. 049-000-163-902; that at and around the time the fringe benefits tax was supposed to have been remitted on July 25, 1998, you were in the midst of an internal reorganization, whereby your General Manager who assumed responsibilities for the company only on June 1, 1998, and your Finance Officer, who just came back from an overseas assignment and assumed office only on August 10, 1998, were both in a transition mode and were still not familiar with the recent changes in our tax legislation; that during the process of familiarising with new tax legislation, you learned of the newly issued revenue regulation on Fringe Benefits Tax; that the company was not able to file the appropriate returns and pay the FBT for the first and second quarters of 1998 on July 25, 1998; and that the company is in good faith and very much willing to pay the corresponding fringe benefits tax for the said period. aTEHIC In reply, please be informed that under Sections 248(A)(1) and (3) and 249, both of the Tax Code of 1997, 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 Phils. 22). EHSAaD In view of the foregoing, we regret to inform you that your request for waiver of the payment of surcharge and penalty is hereby denied for lack of legal basis. Very truly yours, (SGD.) DAKILA B. FONACIER Commissioner of Internal Revenue