Philippine National Police Service Stores System (PNPSSS) (2)

December 9, 2008 FIRB RESOLUTION NO. 017-08 SUBJECT MATTER : Philippine National Police Service Stores System (PNPSSS) (2) WHEREAS, commissary services and post exchange (PX) facilities are intended to augment benefits ( e.g., salaries and allowances) of police personnel in recognition of their work in the area of peace and order; DTcHaA WHEREAS, such services and facilities are recognized as integral adjuncts of the police sector on a global basis; WHEREAS, the FIRB already approved the amount of P43,359,550.00 to cover the taxes due on items which the PNPSSS has purchased and sold to its intended beneficiaries for the year 2008, per FIRB Resolution No. 7-08; WHEREAS, the PNPSSS applied for additional tax subsidy in the amount of P62,586,632.00 corresponding to its additional purchases for the year 2008; WHEREAS, the PNPSSS also requested for the realignment of a portion of the tax subsidy previously granted to it in the amount of P6,376,450.97 covering its excise tax on cigarettes, wines and liquors, per FIRB Resolution No. 7-08, to be used on its VAT liabilities; cSIACD WHEREAS, the additional tax subsidy is intended to support the plan of the PNPSSS to expand some of its branch stores, establish new regional branch stores, reopen provincial branch stores and support the priority programs of the PNP; WHEREAS, there is also a need to ensure that the benefits of these services and facilities are extended only to their intended beneficiaries; NOW, THEREFORE, BE IT RESOLVED, AS IT IS HEREBY RESOLVED, to grant additional tax subsidy to the PNPSSS in the amount of THIRTY SEVEN MILLION FIVE HUNDRED FIFTY ONE THOUSAND NINE HUNDRED SEVENTY NINE AND 20/100 PESOS (P37,551,979.20) only, representing taxes on items purchased and subsequently sold by its outlets to their intended beneficiaries, for the year 2008, in accordance with the following breakdown: Coverage Amount Ratio to Total (In Pesos) Value Added Tax (VAT) on: 36,207,693.00 96.42 Merchandise/Grocery 31,153,846.20 82.96 Petroleum/Tires, Batteries and Accessories 2,769,231.00 7.37 Pharmacy 623,077.20 1.66 Textiles 1,661,538.60 4.42 Excise Tax on: Petroleum 1,344,286.80 3.58 Total 37,551,979.80 100.00 =========== ===== and allow the PNPSSS to realign a portion of the tax subsidy previously granted to it under FIRB Resolution No. 7-08, to cover its VAT obligations instead of excise tax on cigarettes, wines and liquors in the amount of SIX MILLION THREE HUNDRED SEVENTY SIX THOUSAND FOUR HUNDRED FIFTY AND 97/100 PESOS (P6,376,450.97) only. Provided, however, that the PNPSSS shall: (1) submit to the FIRB the details of its system to ensure that commissary privileges are confined solely to their intended beneficiaries, including the following: (a) breakdown of customers by type/category; (b) quantity and purchase limits; and (c) identification requirements for customers; (2) submit to the FIRB the results of the annual audit of its operations by the Commission on Audit or a reliable independent auditor; and (3) cause to be marked on all items entitled to tax subsidy herein granted the words "Tax Subsidized by the Philippine Government, Not for Resale": Provided, further, that such availment shall be in accordance with the terms and conditions of Section 14 of the 2008 General Appropriations Act, subject to the availability of funds therefor, pursuant to the terms and conditions of the Rules and Regulations to Implement the Subsidy Provision Under Executive Order No. 93 and Bureau of Internal Revenue Regulations No. 12-2006. DcHaET (SGD.) GIL S. BELTRAN Undersecretary of Finance Presiding Officer FIRB Reference: Joint FIRB-Technical Committee Meeting dated December 9, 2008.