Revised Regulations Governing the Issuance of Tax Clearance Certificates

May 2, 1967 REVENUE REGULATIONS NO. 19-67 SUBJECT : Revised Regulations Governing the Issuance of Tax Clearance Certificates TO : All Internal Revenue Officers and Others Concerned Pursuant to the provisions of Section 338 in relation to Section 4 of Commonwealth Act No. 466, as amended, otherwise known as the National Internal Revenue Code, the following regulations which shall hereafter be known as "The Revised Regulations Governing the Issuance of Tax Clearance Certificates" are hereby promulgated for the information and guidance of all internal revenue officers, customs officials, common carriers by air and water, and others concerned. cdtech SECTION 1. Purpose and scope These regulations propose to establish a uniform procedure in the processing of applications for tax clearance certificates not only for travel abroad but also for purposes of naturalization, change of name or requirement of any government lending institution, bureau, or office in conformity with existing laws, rulings, precedents and present practices and to designate the government official to be charged with the responsibility of processing tax clearance applications and issuing tax clearance certificates. SECTION 2. Certificate of tax clearance to be secured by all persons leaving the Philippines . (a) Citizens Any citizen of the Philippines contemplating to leave the country with intent to return at a later date must apply for a tax clearance certificate on the application form prescribed by the Bureau of Internal Revenue. Upon receipt of the application by the Tax Clearance Section at the National Office or at the other offices mentioned in Section 5, infra, the same shall be serially numbered, recorded and processed. The processing of the application shall be done by a thorough checking of all the tax liabilities of the applicant. In all cases where no previous tax clearance certificates have been issued to the applicant, the inquiry shall embrace a period of five years prior to the date of application. Where, however, the applicant has been previously issued such certificate, the period of inquiry shall cover only the intervening period from the date of the issuance of the last certificate to the date of subsequent application. Where, upon verification of the master tax delinquency lists, a taxpayer is found to be delinquent in the payment of taxes for prior years, no tax clearance certificate shall be issued except: 1. Upon authority of the Commissioner or Deputy Commissioner of Internal Revenue; or 2. Upon the presentation of a certificate from the clerk of the Supreme Court or the Court of Tax Appeals if the tax case is contested and is pending resolution by such court; or 3. Upon the presentation of a certificate from the Revenue Operations Head (Legal) of the Bureau of Internal Revenue if the tax case is contested administratively or from the Regional Director or Revenue Operations Head (Special Operations) if the tax case is pending reinvestigation; or 4. Upon the filing of a surety bond equal to the amount of the delinquency in all such cases as are not contested. aisadc In all the cases enumerated above, the authority, certification or surety bond shall form part of the application and shall remain in the records of the office issuing the tax clearance certificate subject to inspection at all times. If the applicant is a citizen of the Philippines leaving the country to take up permanent residence abroad as an immigrant to a foreign country, no tax clearance certificate shall be issued unless all his tax liabilities are paid in full. (b) Resident Aliens If a resident alien is contemplating to leave the country with intent to return within a period of two years from the date of departure, the same rules promulgated in sub-paragraph (a) shall apply. If he is leaving the country with intent to return after two years from the date of departure or with no intention of ever returning, no tax clearance certificate shall be issued unless all his tax liabilities are paid in full. (c) Non-resident aliens No tax clearance certificate shall be issued to a non-resident alien unless all his tax liabilities are paid in full. (d) In general All persons departing from the Philippines after December 31 but prior to the last day for the filing of income tax returns or any other return required by law must, at the time of the filing of the application for a tax clearance certificate, file the corresponding income or other tax return and pay any tax shown to be due by such return before a tax clearance certificate is issued. If the applicant is a citizen of the Philippines leaving the country with intent to return or a resident alien leaving the country with intent to return within two years after the date of departure and he is unable to pay in cash the tax obligation mentioned herein, he may be allowed to file a surety bond equal to the amount of such tax obligation. The Commissioner or Deputy Commissioner of Internal Revenue may, however, waive the filing of a surety bond if he is satisfied that the guaranty appearing at the back of the application is sufficient. SECTION 3. Persons exempted from tax clearance requirement . The requirement of a tax clearance certificate shall not only apply to sovereigns of foreign governments and the members of their entourage, whether personal or official, representatives of foreign governments bearing diplomatic passports, and consular agents and tourists not engaged in commerce in the Philippines. Tourists or transient visitors need not secure certificates of tax clearance nor execute an affidavit attesting to their exemption from internal revenue taxes upon their departure from this country if their stay in the Philippines does not exceed fifty-nine days. However, tourists who engage in commerce or receive income during their stay in the Philippines should secure the certificate of tax clearance regardless of the period of their stay in this country. In accordance with an understanding between the government of the Republic of the Philippines and the United States of America, all citizen-personnel of the United States government are required to procure certificates of tax clearance but such persons are exempted from the payment of income and residence taxes, including the documentary stamp tax on tax clearance certificates, if no other income is received from Philippine sources. SECTION 4. Certificate of tax clearance After an application for tax clearance certificate has been duly processed as required in section 2 hereof, a tax clearance certificate shall be issued on B.I.R. Form No. 17.14 for applicants desiring to leave the Philippines. The corresponding documentary stamps in accordance with Section 225 of the National Internal Revenue Code, as amended by Section 14 of Republic Act No. 40, shall be affixed to the duplicate of the tax clearance certificate and duly cancelled, to wit: fifteen pesos on each certificate for a first class passenger; eight pesos for a second class or tourist class passenger; and two pesos for a third class or steerage passenger. Documentary stamps at the above rate to correspond to the number of passengers of ages one year or over embraced in the tax clearance certificate should be affixed to the duplicate and a notation that the required documentary stamps have been affixed and duly cancelled as required herein shall be made on the original. A tax clearance certificate for travel abroad shall be valid for thirty days from the date of issue but may be extended for another thirty days only upon previous application to and approval by the issuing officer after which it shall become null and void. In all cases involving naturalization, change of name or other domestic clearances provided in Section 1 hereof, the tax clearance certificate on the prescribed forms shall be issued subject to the conditions set forth in Section 2 hereof but only insofar as tax delinquents are involved. SECTION 5. Officials authorized to issue tax clearance certificates . The Commissioner or Deputy Commissioner of Internal Revenue, the Chief, Tax Accounts Division, or any official designated by the Commissioner is hereby invested with the exclusive authority to issue tax clearance certificate in Manila, Quezon City, Pasay City, Caloocan City, Cavite City, Trece Martires City and Tagaytay City and the provinces of Rizal, Bulacan and Cavite. In all other parts of the Philippines, the regional director or the revenue district officer of the region or revenue district, as the case may be, in which the applicant is permanently residing or has his place of business, and the deputy provincial treasurers stationed in the sub-ports of Bongao, Sitangkai, Taganak, Cagayan de Sulu, and Balabac, are hereby also authorized to issue tax clearance certificates in their respective territorial jurisdictions. The aforesaid deputy provincial treasurers shall submit to the Revenue District Officer at Jolo, Sulu, a weekly report containing a list of all the names and addresses of applicants who had been issued tax clearance certificates. SECTION 6. Repealing Clause . Revenue Regulations Nos. V-32, V-49, V-61 and 1-64 and any other regulation, memorandum, circular, or order dealing on the same subject are hereby repealed. SECTION 7. Date of effectivity . These regulations shall take effect upon promulgation in the Official Gazette. JUAN PONCE ENRILE Acting Secretary of Finance Recommended by: MISAEL P. VERA Commissioner of Internal Revenue ATTACHMENT 1st Indorsement August 14, 1967 Respectfully returned to the Commissioner of Internal Revenue, Manila, the attached proposed Revenue Regulations No. 19-67, dated May 2, 1967, otherwise known as "The Revised Regulations Governing Issuance of Tax Clearance Certificates", establishing a uniform procedure in the processing of applications for tax clearance certificate for travel abroad and other purposes, approved. JUAN PONCE ENRILE Acting Secretary