Enhancing Tax Enforcement and Collection Efforts

March 30, 2001 DILG MEMORANDUM CIRCULAR NO. 033-01 TO : All Provincial Governors, City Mayors, Municipal Mayors, Punong Barangays, DILG Regional Directors and Others Concerned SUBJECT : Enhancing Tax Enforcement and Collection Efforts The Department of Finance, the Bureau of Internal Revenue, the League of Provinces, League of Cities, League of Municipalities, Liga ng mga Barangay, and this Department, executed a Memorandum of Agreement in response to the need to further improve efforts relative to tax enforcement and collection at the local level. Towards this end, and as embodied in the said Memorandum of Agreement, all Provincial Governors, City Mayors, Municipal Mayors and Punong Barangays, or through their authorized local government personnel, are hereby enjoined to: 1. provide the Bureau of Internal Revenue (BIR) with an annual alphabetical list of taxpayers, whether individuals or corporations, who are issued with provincial, city, municipal or barangay permits to engage in business. The said list, which is to be presented in a matrix form, shall contain the following information: (a) Permit Number; (b) Date Issued; (c) Taxpayer Identification Number (TIN); (d) Name of Taxpayer or Trade Name; (e) Type of Business; (f) Address; (g) Annual Gross Receipts; and (h) Remarks. The list of taxpayers shall be submitted to the Revenue District Office (RDO) every 1st day of March starting Calendar Year 2001, and every year thereafter; 2. require the presentation of the following documents prior to the renewal of a business permit: (a) Income Tax Return(s) of the preceding quarter(s) and/or year; (b) VAT or Percentage Tax Return(s); (c) BIR Registration Certificate (BIR Form 2303); and (d) Annual Registration Fee payment (BIR Form 0605); 3. furnish the concerned RDO with a quarterly list of contractors who are engaged in government contracts entered into by the provincial, city, municipal or barangay government every 15th day of the month immediately following the end of the quarter. The said quarterly list, which is to be prepared in a matrix form, shall indicate the following information: (a) TIN; (b) Name of Contractor; (c) Address; (d) Project; (e) Date Awarded; and (f) Amount of Contract; 4. include the TIN as a part of the essential requirements in all applications for government permits, licenses, clearances, official papers and documents, as well as, in Community Tax Certificates; 5. pursuant to Revenue Memorandum Order No. 70-98 as amended, ensure the withholding of correct taxes, and remit the same on or before the date prescribed by law and other existing rules and regulations; 6. submit an update of the Current or Fair Market Value of a property to the BIR Assessment Service, ATTN: Asset Valuation Division, in case of a revision or upon request. The said update, which is to be prepared in a matrix form, shall include the following information: (a) Classification of the Property, i.e., agricultural, residential, commercial, or general purpose; (b) Barangay; (c) Subdivision; and (d) Fair Market Value; 7. submit to the concerned RDO an annual alphabetical list of professionals who are issued with Professional or Occupation Tax Receipts (PTR/OTR), every 31st day of January of the ensuing year. The said list which is to be prepared in a matrix form, shall contain the following information: (a) PTR/OTR Number; (b) Date Issued; (c) TIN; (d) Name of Taxpayer; (e) Address; (f) Telephone or Fax Number; and (g) Remarks; 8. assist in the dissemination of tax reminders through the printing of the following messages: Taxes are the lifeblood of our government. Pay taxes honestly and prompt, in all statements of accounts, communication documents, and packaging materials; 9. assist the BIR in promoting its programs and other reminders or campaigns on the issuance of Official Receipts for every purchase made by the taxpayers; 10. submit to the BIR Revenue Accounting Division the requirements useful in the computation and issuance of the following Certificates: (a) 40% mining taxes collected per Republic Act No. 7160; (b) Franchise Taxes paid by the Manila Jockey Club, Inc. and the Philippine Racing Club, Inc. pursuant to Republic Act No. 6631, as amended; and (c) Special Privilege Tax 60% of the SPT collection from mini-hydro electric plant as embodied under Republic Act No. 7156, as in the case of concerned local government units; 11. assist the concerned RDO in locating unregistered taxpayers and delinquent taxpayers; and 12. allow BIR authorized personnel access to assessment, collection and remittance records, subject to pertinent provisions of applicable laws, rules and regulations. In the said Memorandum of Agreement, the Bureau of Internal Revenue is likewise committed to, among other responsibilities: 1. provide the Department of Budget and Management and the four major leagues of local governments with annual internal revenue tax collection which is the basis of computing the internal revenue allotments of local government units in accordance with the specific provisions of the Local Government Code; 2. notify, in advance, those local government units that may not be able to remit their withholding taxes on time; and 3. allow interested local government units access to BIR records, subject to the limitations prescribed under the National Internal Revenue Code. All DILG Regional Directors are likewise hereby directed to cause the immediate and widest dissemination of this Memorandum Circular to all local government units within their jurisdictions, and to see to it that the intent of this issuance is accordingly complied with. ACcISa For the information and guidance of all concerned. (SGD.) JOSE D. LINA, JR. Secretary Department of Interior and Local Government Attested by: (SGD.) ATTY. AGRIPINO G. MORGA Head Executive Assistant