Surcharge for Unlawful Cutting of Timber in Excess of the Quota Granted

May 12, 1959 BIR RULING NO. 253-59 MEMORANDUM FOR The Chief, Business Tax Division B.I.R., Manila There are returned to you the records of the case of Mr. Leonardo C. Valdepenas, involving the sum of P18,823.71, representing 300% surcharge due from him for having unlawfully cut timber in excess of the quota granted under his license. The reasons stated by Mr. Valdepenas in his letter dated May 18, 1954, as well as the waiver of the collection of said surcharge contained in the letter dated July 13, 1954 of the Director of Forestry, cannot exempt the former from the payment of the surcharge in question. Neither do the reasons advanced in the letter dated December 16, 1958 of the Director of Forestry justify such waiver. The provisions of section 267 of the Tax Code are quite clear that in cases such as the present, the charges on timber cut shall be increased by 300%. Moreover, the imposition of a surcharge is mandatory and ordinarily confers no discretion on the Commissioner of Internal Revenue (Lim Co Chui vs. Posadas, 47 Phil., 470). As a matter of fact, while said section 267 authorizes the Commissioner to waive, in meritorious cases, the 25% surcharge imposed for discharging forest products without permit, no similar authority exists with respect to illegal cutting or gathering of forest products. If the Commissioner of Internal Revenue has no authority to waive the imposition of the surcharge in question, much less can the Director of Forestry have the authority, forest charges being internal revenues and, therefore, are not within the province of the latter. Accordingly, your query is answered in the affirmative. (SGD.) JOSE ARAAS Commissioner of Internal Revenue