Bureau of Local Government Finance Opinion

May 12, 2010 BUREAU OF LOCAL GOVERNMENT FINANCE OPINION Mr. Alberto H. Suansing Assistant Secretary Land Transportation Office Department of Transportation & Communications East Avenue, Quezon City Sir : This refers to your 1st Indorsement dated April 8, 2010 to the Honorable Margarito B. Teves, Secretary of Finance, requesting advice whether the opinion dated December 6, 1999 of the Former Secretary of Finance, Edgardo B. Espiritu still prevails, which was forwarded to this Bureau for appropriate action. The said opinion was issued in view of the letter of Dr. Flor S. Enriquez, Philippine Dental Association requesting opinion on the need of Mayor's Permit and Professional Tax in the operation of a dental clinic. In this connection, please be informed that a proposed Local Finance Circular clarifying the imposition of taxes, fees and charges on professionals operating private clinics as well as private offices had been submitted to the Secretary of Finance for approval. The proposed Circular, gives emphasis on the professional tax being a fixed tax on the professional imposable by the province or city, while the business tax is a tax on the business based on gross receipts levied by a municipality or city. Thus, it is the operation of the clinic/office that is being taxed and not the individual/professional. With regard to the Mayor's permit, it is mandatory under Section 147 of the Local Government Code of 1991 (RA 7160) for the owner/operator of any business or calling to secure a permit from the LGU concerned before its operation. That Office will be advised accordingly as soon as the Circular is approved. DcTAIH Very truly yours, (SGD.) MA. PRESENTACION R. MONTESA Executive Director