Compliance with Withholding Tax Regulations

October 5, 1995 DILG MEMORANDUM CIRCULAR NO. 164-95 TO : All Provincial Governors, City Mayors, Municipal Mayors, Provincial, City and Municipal Treasurers, DILG Regional Directors and Others Concerned SUBJECT : Compliance with Withholding Tax Regulations Under pertinent provisions of the National Internal Revenue Code (NIRC) and its implementing regulations, all government offices (national or local, including government-owned or controlled corporations) are required to deduct and withhold taxes from compensation income of employees and on income payments made to individuals and corporations subject to Expanded and Final Withholding Taxes and on government money payments pursuant to Republic Act No. 1051, such as percentage, caterers, franchise taxes, etc., and on value added tax withheld pursuant to Republic Act No. 7649 as implemented by Revenue Regulations Nos. 4-88 dated January 21, 1988 and 10-93, dated June 16, 1993, respectively. In view thereof, and in support of the BIR's efforts to increase tax collection, all Local Chief Executives are reminded of their responsibilities as withholding agents, to strictly implement withholding tax laws and regulations through the Provincial, City or Municipal Treasurer, as the case may be, or in his/her absence, the Provincial/City/Municipal Accountant. All concerned officers in charge of withholding taxes are hereby advised that failure to comply with the said requirements may subject them to administrative and penal liabilities pursuant to Sections 73, 247 and 271 of the NIRC, as implemented by Revenue Regulations No. 1-87. Furthermore, Provincial Governors, City Mayors and Municipal Mayors and encouraged to provide full support to Revenue Officers of Revenue District Offices who may conduct dialogues/seminars/field visits on the matter among local government offices. All DILG Regional Directors are directed to disseminate this issuance to LGUs within their jurisdictions, provide technical assistance, as appropriate and upon request and monitor compliance thereto. For the information and guidance of all concerned. RAFAEL M. ALUNAN III Secretary Department of Interior and Local Government