Tax Liability of An Operator of a Provincial Taxi

August 16, 1990 BIR RULING NO. 156-90 115 000-00 156-90 S i r : This refers to your letter dated May 28, 1990 requesting information on the following: 1. Rate of percentage tax per unit of taxi with L.T.F.R.B. Franchise Decision which is operating outside Metro Manila to any point of Luzon; 2. Whether a taxi with L.T.F.R.B. Franchise Decision is subject to the percentage tax if it is not operating due to some unavoidable circumstances; and 3. Whether there are rules and regulations issued by this Office authorizing the Registrar of the Land Transportation Office to question, examine or scrutinize your payment of percentage tax. In reply, please be informed that under Section 115 of the Tax Code, an operator of a provincial taxi shall pay a tax equivalent to 3% of his quarterly gross receipts and in computing said 3% tax, the aforesaid section sets the amount of P2,400.00 as the minimum quarterly gross receipts of the operator thereof. The fact that the taxi has not been in operation due to some unavoidable circumstances will not exempt the operator from paying the 3% tax based on the said minimum quarterly gross receipts. As to whether this Office has authorized the Registrar of the Land Transportation Office to question, examine or scrutinize the payment of percentage tax by a taxi operator, you are informed in the negative. Under Section 7 of the Tax Code, the power of ascertaining the correctness of any return, making a return when none has been made, determining the liability of any person for internal revenue tax or collecting such liability belongs to the Commissioner of Internal Revenue. The Commissioner of Land Transportation and his subordinates are constituted agents of this Office only with respect to the collection of energy tax. (Section 6, Tax Code, as amended by E.O. No. 273) cdi Very truly yours, (SGD.) JOSE U. ONG Commissioner