DOJ Opinion No. 058, s. 1995

DOJ OPINION NO. 058 , s. 1995 June 2, 1995 Hon. Lina B. Laigo Acting Secretary Department of Social Welfare and Development Constitution Hills, Quezon City M a d a m : This has reference to your request for opinion and interpretation of the term "tax credit" as stipulated in Section 4 of Republic Act No. 7432 (An Act To Maximize The Contribution Of Senior Citizens To Nation Building, Grant Benefits And Special Privileges And For Other Purposes). You state that one of the major problems encountered in the implementation of said R.A. No. 7432 is the claim to tax credit by private establishments who have granted 20% discounts relative to utilization of transportation services, purchase of medicines, hotels and restaurants, etc. You further state that while the drugstores/pharmaceutical associations and drug companies content that the term tax credit should be understood as credit against tax itself, the Bureau of Internal Revenue has different view. Under its Revenue Regulations No. 2-94 dated August 23, 1993, which is attached to your request, "tax credit" has been defined as follows: "Tax Credit refers to the amount representing the 20% discount granted to a qualified senior citizens by all establishments relative to their utilization of transportation services, hotels and similar lodging establishments, restaurants, drugstores, recreation centers, theaters, cinema houses, concert halls, circuses, carnivals and other similar places of culture, leisure and amusement, which discount shall be deducted by the said establishments from their gross income for income tax purposes and from their gross sales for value-added tax or other percentage tax purposes ." (emphasis supplied). In this connection, this Department's clarification of the term "tax credit" is requested to settle the controversy on the matter. With regret, we have to decline rendition of the opinion/clarification requested. We note that the resolution of your query involves the interpretation and/or clarification of the provisions of the aforesaid BIR Revenue Regulations No. 2-94 which was issued to implement R.A. No. 7432 relative to the granting of tax exemption and other privileges to senior citizens and to prescribe the guidelines for the availment thereof. The Secretary of Justice does not possess revisory authority over issuances of other department/agencies. For this reason, this Office has consistently refrained from expressing its views on matters involving the issuances of other agencies, since such matters are best left to the determination of the promulgating administrative agency by reason of its familiarity with intent and purposes of the issuance and the extent of the application thereof (Secretary of Justice Op. No. 74, s. 1989; Nos. 1 and 91, s. 1992; and No. 91, s. 1993). Moreover, your query involves claims for "tax credits" by private parties, such as owners of transportation companies, drug stores, hotels, restaurants, recreation centers, etc. Opinions of the Secretary of Justice, it bears stress, are merely advisory in nature and have no binding effect upon private persons or entities which, in all probability, would contest any such opinion before the courts, if it is contrary to their individual interests. By established policy and precedents, this Office does not render opinion or give legal advice on a matter which is justiciable in nature or which may be the subject of a judicial controversy (Id., Ops. No. 182, s. 1990; No. 36, s. 1984; and No. 73, s. 1983). Very truly yours, (SGD.) TEOFISTO T. GUINGONA, JR. Secretary