Suspension of the Issuance of Mission Orders for Inventory Verification (Revenue Memorandum Order No. 18-95) Under Certain Conditions

September 1, 1995 REVENUE MEMORANDUM ORDER NO. 28-95 (amended by RMO 37-95) SUBJECT : Suspension of the Issuance of Mission Orders for Inventory Verification (Revenue Memorandum Order No. 18-95) Under Certain Conditions TO : All Internal Revenue Officers Concerned I. OBJECTIVES This Order is issued to: 1. Set the policies and guidelines in the suspension of Mission Orders for inventory verification under Revenue Memorandum Order (RMO) No. 18-95. 2. Gain voluntary support from concerned taxpayer in the declaration of accurate inventory. 3. Establish an effective measure to generate additional revenue to the government at the least inconvenience to the taxpayer. II. POLICIES AND GUIDELINES A. REVENUE DISTRICT OFFICER 1. For the purpose of giving opportunity to taxpayer to file an additional list of inventory, the Revenue District Officer shall declare a moratorium on inventory verification and issuance of Mission Orders starting September 20, 1995 up to November 20, 1995 under the following conditions: a. The taxpayer shall submit a Letter of Intent of file a list of additional inventory during the period of availment. b. The List of Additional Inventory (LAJ) shall be submitted within thirty (30) days from filing of the Letter of Intent. c. All items in the LAI shall be included in the stock-in trade or inventory of raw materials or supplies used in the production of the taxpayers' finished product during the year. d. The items listed in the LAI shall not generate any input tax. e. Sales derived from the additional inventory shall be invoiced and declared as sales for the year 1995 and thereafter. f. The corresponding adjustment in the inventory must be reflected as a debit to purchases and a credit to a capital account during the taxable year 1995 and shall be accepted without any verification from the Bureau as to the source of capital used, provided that the upward adjustment in the inventory must no less than 20% of the previous declaration. 2. Mission Orders issued but not served as of September 30, 1995 shall be held in abeyance by the Revenue District Officer. 3. On-going inventory verification as of September 20, 1995 shall be stopped immediately and the taxpayer shall be given an opportunity to declare an accurate inventory list within the period prescribed in this Order. 4. For those Mission Orders already issued, served and terminated the Revenue Officers assigned shall submit the reports as required under RMO No. 18-95 on or before October 15, 1995. 5. A summary listing of Mission Orders issued, terminated and cancelled as of September 30, 1995 shall be prepared by the Revenue District Officer and submitted to the Assistant Commissioner, Assessment Service on or before October 20, 1995, with copies of individual Mission Orders. 6. Taxpayers who have not filed their Letters of Intent and LAI within the period prescribed in this Order shall be subjected to the regular verification of inventory under RMO No. 18-95. 7. Taxpayer who have availed themselves of this opportunity and have satisfied all the conditions prescribed herein shall no longer by subjected to verification of their adjusted inventory for the taxable year 1995. B. REVENUE REGIONAL DIRECTOR 1. The Chiefs of Assessment Divisions through the Revenue Regional Directors shall submit the required Report of Terminated/Assessed Cases on Inventory Verification (Annex D of RMO 18-95) as of October 15, 1995 to the Assistant Commissioner, Assessment Service on or before October 25, 1995. III. EFFECTIVITY This Order shall take effect immediately and shall remain in effect until further lifted. LIWAYWAY VINZONS-CHATO Commissioner of Internal Revenue