Philippine Deposit Insurance Corporation (1)

October 2, 2009 FIRB RESOLUTION NO. 018-09 SUBJECT MATTER : Philippine Deposit Insurance Corporation (1) WHEREAS, the Philippine Deposit Insurance Corporation's (PDIC) primary mandate is to implement a deposit insurance system for the protection of bank deposits; WHEREAS, the PDIC charter was amended by Republic Act (RA) No. 9576 (April 29, 2009) for the purpose of promoting and safeguarding the interest of the depositing public by way of institutional and financial strengthening of the PDIC as a regulatory agency exercising governmental functions with responsibility to provide safeguards against risks of bank failures; WHEREAS, the strengthening of the deposit insurance system will make it more flexible and responsive to the needs of the depositors while promoting secure and sound banking activities; WHEREAS, in recognition of the PDIC's institutional and financial strengthening reform package, RA No. 9576 provides that all tax obligations of the PDIC shall be chargeable to the Tax Expenditure Fund (TEF) in the annual General Appropriations Act (GAA) for a period of five (5) years reckoned from the date of effectivity of the Act on June 1, 2009; NOW, THEREFORE, BE IT RESOLVED, AS IT IS HEREBY RESOLVED, to grant tax subsidy to the PDIC in the amount of ONE BILLION ONE MILLION (P1,001,000,000.00) only broken down as follows: Final withholding tax on interest income from government securities P925,000,000.00 Income tax (June-December 2009) 12,000,000.00 Other Taxes Capital Gains Tax (CGT) P30,000,000.00 Documentary Stamp Tax (DST) 24,000,000.00 Fringe Benefits Tax (FBT) 10,000,000.00 64,000,000.00 TOTAL P1,001,000,000.00 ============== Provided, however, that: (a) the initial issuance of the corresponding Certificate of Entitlement to Subsidy (CES) shall be limited to the amount of P367,498,126.10 only representing the final tax on interest income from government securities for the months of June (P31,441,167.01), July (P210,508,849.95) and August 2009 (P125,548,109.14.00) * (Annex A) ; and (b) the subsequent CES shall be issued upon the submission by the PDIC to the FIRB of its actual tax liability based on the assessment of the Bureau of Internal Revenue (BIR): Provided, further, that such availment shall be in accordance with the terms and conditions of Section 13 of the 2009 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. ISHaCD GIL P. MONTALBO Director Department of Budget and Management (SGD.) ELMER C. HERNANDEZ Undersecretary Department of Trade and Industry (SGD.) MARGARITA R. SONGCO Deputy Director-General National Economic and Development Authority (SGD.) JAMES H. ROLDAN Assistant Commissioner Bureau of Internal Revenue (SGD.) REYNALDO V. UMALI Deputy Commissioner Bureau of Customs (SGD.) LINA D. ISORENA Executive Director Head, FIRB Secretariat National Tax Research Center (SGD.) GIL S. BELTRAN Undersecretary of Finance Presiding Officer-FIRB ANNEX A Tax Subsidy Endorsed for the Philippine Deposit Insurance Corporation (PDIC) Coverage of the 1st CES Type of Tax Month Covered Amount 1. Final withholding tax on interest income June 2009 31,441,167.01 from government securities 2. Final withholding tax on interest income July 2009 210,508,849.95 from government securities 3. Final withholding tax on interest income August 2009 125,548,109.14 from government securities TOTAL 367,498,126.10 =========== Source: PDIC and Bureau of the Treasury (BTr)