Further amendment of the penalties stipulated in the Agreement prescribed in Revenue Regulations Nos. 5-84 and 1-85.

August 8, 1994 REVENUE REGULATIONS NO. 15-94 SUBJECT : Further Amendment of the Penalties Stipulated in the Agreement Prescribed in Revenue Regulations Nos. 5-84 and 1-85 TO : All Officials Concerned of the Bureau of Treasury, Bureau of Internal Revenue and Accredited Banks Paragraph 6 and 14a of the banks' obligation in the Agreement prescribed in Revenue Regulations Nos. 5-84 and 1-85 which took effect on May 29, 1984 is hereby amended to read as follows: (6) Pay the following penalties: aisa dc a) on late remittances of collections a 20% per annum surcharge plus 1/4 of 1% interest per day thereon but shall not be less than the prevailing interbank borrowing rate plus 5% until the total amount and increments are fully paid. b) on late submission of required collection reports a P 200.00 fine for every day of delay in the submission of each required report but not to exceed twenty five percent (25%) of the tax collected. c) on the submission of incomplete and/or inaccurate a P 200.00 fine for every incomplete and/or inaccurate collection report submitted but exceeding twenty five percent (25%) of the tax collected. d) on acceptance of the following checks: 1) accommodation check 2) post-dated check 3) stale check 4) unsigned check 5) out-of-town check - a P 1,000.00 fine per check received (14) To protect the interest of the government, the Bank hereby authorizes: aisa dc a) the BSP thru its Accounting Department, to debit its demand deposit accounts corresponding to the total daily collections due for remittance on the 6th calendar day after the date of collections such amount to be credited by BSP to the "Special Account-BIR Collection" of the Treasurer of the Philippines. This Amendment shall take effect immediately. ROBERTO F. DE OCAMPO Secretary of Finance Recommending Approval: LIWAYWAY VINZONS-CHATO Commissioner AGREEMENT The BUREAU OF INTERNAL REVENUE, known hereinafter as the BIR, represented by _____________________________ Commissioner of Internal Revenue, National Office Building, Diliman, Quezon City and the ______________________________________________ represented by _________________________________ known hereinafter as the BANK, after having been accredited and authorized to receive and collect internal revenue taxes, do hereby agree on the following: The BANK shall (1) acknowledge receipt of all tax returns of all tax returns and other documents covered under the New Payment Control System (NPCS) and receive internal revenue tax payments, if any, thru validating machines duly registered with the BIR; (2) book all such collections and credit the same to the Special Account "Due to Bangko Sentral Bureau of Internal Revenue"; (3) accomplish and submit all requirements prescribed under RMO Nos. 29-91, 1-93 and such other issuances that may be subsequently issued by BIR and shoulder all expenses concerning the accomplishment and submission thereof; (4) maintain adequate balance in their demand deposit account with the Bangko Sentral ng Pilipinas, Manila (BSP) to take care of their daily remittance of tax collections subject to verification by the BIR; (5) keep and maintain separate records in each branch and head office for internal revenue collections specified in the rules and regulations which shall be made available for inspection and audit by duly authorized BIR Officers upon demand; (6) pay the following penalties: a) on late remittance of collections a 20% per annum surcharge plus 1/4 of 1% interest per day thereon but shall not be less than the prevailing interbank borrowing rate plus 5% until the total amount and increments are fully paid. b) on late submission of required collection reports a P 200.00 fine for every day of delay in the submission of each required report but not to exceed twenty five percent (25%) of the tax collected. c) on the submission of incomplete and/or inaccurate collection reports a P 200.00 fine for every incomplete and/or inaccurate collection report submitted but not exceeding twenty five percent (25%) of the tax collected. d) on acceptance of the following checks: 1) accommodation check 2) post-dated check 3) stale check 4) unsigned check 5) out-of-town check a P 1,000.00 fine per check received. (7) transmit returned or dishonored checks to the BIR in the appropriate form and deduct the amounts involved from the gross collections on the day such checks were received; (8) inform the Bank's officers and employees charged with the tax collection functions about the terms and conditions of this Agreement as well as on the rules and regulations relative to the collection of internal revenue taxes; (9) communicate to the Collection Service any changes in the information previously stated in the application for accreditation such as: a) name and organizational structure of the bank; b) address and telephone number of the head office and branches; c) contact persons and officers charged with the collection or reporting of revenue collection including bank branch managers; (10) open on Saturdays or public holidays and extend their banking hours when requested by the Revenue District Offices (RDOs), particularly during deadlines; (11) keep confidential all information shown in the returns, reports and other documents received by it as provided for under Section 269 of the Tax Code. Accordingly, the bank shall not keep any copy of all such returns and other documents received; (12) abide by the rules and regulations promulgated by the BIR in connection with this agreement and those that may be promulgated thereafter; (13) assign only personnel who have undertaken training under the New Payment Control System (NPCS); (14) to protect the interest of the government, the bank hereby authorizes: (15) a) the BSP thru its Accounting Department, to debit its demand deposit accurate corresponding to the total daily collections due for remittance on the 6th calendar day after the date of collection, such amount to be credited by BSP to the "Special Account BIR Collection" of the Treasurer of the Philippines. b) the BIR to seize and hold so much of its properties, real and personal, as well as rights to such properties if the Bank's demand deposit accounts with BSP are not sufficient to satisfy the unremitted collections, penalties, interest and surcharges. c) the BIR to advise the BSP to debit the amount of unremitted collections including penalties, surcharges and interest against the Bank's demand deposit accounts in case of none or late remittance. The BIR shall (1) provide adequate training and/or assistance to Bank personnel charged with the tax collection functions; (2) undertake to install and implement the necessary security/control measure to ensure the early detection of and/or as a deterrent against fraud. Immediately advise the banks concerned of cases where the taxpayer provides proof/evidence of tax payments which are inconsistent with bank records; (3) reconcile the amount collected with the amount remitted by the bank; (4) request the BSP thru its Accounting Department to debit the amount of unremitted collections plus penalties, surcharges and interests against the Bank's demand deposit accounts; (5) advise the BSP to debit or credit the demand deposit accounts of the Bank when adjustment is necessary such as erroneous or double reporting of internal revenue collections and simultaneously debit or credit the account of the Treasurer of the Philippines for the same amounts; (6) demand from the accredited bank, penalties for delayed reporting, late remittance, or incomplete/inaccurate submission of reports and acceptance of checks; (7) institute civil and/or criminal action arising from the delayed submission or non-submission of reports and late or non-remittance of collections; (8) take possession of the Bank's property in case of default in the remittance of internal revenue collections when the Bank's demand deposit accounts are not sufficient to satisfy the unremitted collections, penalties, interests and surcharges; (9) suspend the authority to collect internal revenue taxes or terminate this agreement in case of violation of any term and condition stated herein; and (10) reserve the right to limit or withdraw the authority of a particular bank branch to accept tax payments or to direct a bank branch to provide bank services in area/s not adequately served upon prior consultation with the bank concerned and subject to the mutual agreement of both parties. The parties hereby recognize that payment or remittance of the tax by the bank payment of interests, penalties, or surcharges on account of none or delayed remittance of tax collections or acquiescence of BIR on any infraction of these regulations, shall not be construed as a waiver by the BIR of its right to take civil, criminal or administrative action against the Bank. Notwithstanding the provisions stipulated above, filed auditors of the Commission on Audit may at any reasonable time, examine any document or record of the bank pertaining to collection and remittance of internal revenue taxes. This Agreement is effective for a period of one (1) year from the date hereof, renewable annually unless sooner terminated by either party. IN WITNESS WHEREOF, we sign this Agreement this _____ day of __________________, 19____. BUREAU OF INTERNAL REVENUE ______________________ Name of Bank By: By: __________________________ ____________________________ Commissioner of Internal Revenue ACKNOWLEDGEMENT REPUBLIC OF THE PHILIPPINES ) CITY OF _____________________) S.S. In the Municipality/City of _______________________________ on the ______ day of ____________________________, 19_________, personally appeared before me, _________________________________ ______________________ of the Bank described and named in the foregoing instrument of Agreement, and he was duly authorized by Board of Directors to execute said instrument, known to me to be the same person who executed said instrument on behalf of the Bank named therein, and he acknowledged to me that the same is the free act and deed of said bank. The Residence Certificate of the said Bank were exhibited to me, and the same being No. ________________________ issued at __________________ on ____________________________. IN WITNESS WHEREOF, I have hereunto set my hand and seal this ___________ day of __________________________. NOTARY PUBLIC Doc. No. ____________ Page. No. ____________ Book No. ____________ Series of 19___________ REPUBLIC OF THE PHILIPPINES ) CITY OF _____________________) S.S. In the Municipality/City of ______________________________ on the _____________ day of _____________________. 199____, personally appeared before me, LIWAYWAY VINZONS-CHATO, Commissioner of Internal Revenue, who is the same person named in the foregoing Agreement, known to me to be the same person who executed the said instrument on behalf of the Bureau of Internal Revenue and acknowledged to me that the same is her free act and deed. The Residence Certificate of said Commissioner of Internal Revenue was exhibited to me, and the same being No. _____ issued at ____________________ on __________, 19____. IN WITNESS HEREOF, I have hereunto set my hand and seal this __________ day of _________________________________. NOTARY PUBLIC Doc. No. _____________ Page No. _____________ Book No._____________ Series of 19 ___________