BIR issues controversial seizure warrants

Published December 2, 2019, 2:08 PM

by Francine Ciasico

By Jun Ramirez 

The Bureau of Internal Revenue (BIR) has come out with a controversial tax enforcement collection strategy which was described by many tax lawyers as unconstitutional.

Bureau of Internal Revenue (MANILA BULLETIN)
Bureau of Internal Revenue (MANILA BULLETIN)

The two-page unnumbered memorandum issued by the agency’s legal service called for the issuance of seizure warrants against the assets of a taxpayer protesting the deficiency tax assessment before the Court of Tax Appeals (CTA).

Tax practitioners argued that under existing regulations, the BIR cannot issue warrant of garnishment when the deficiency tax assessment reaches the tax court.

“The prohibition was a way of upholding the due process right of taxpayers,” said a former tax fraud official who declined to be named.

He added that only the Supreme Court has the final say whether the collection of deficiency taxes becomes “demandable” and “executory.”

A high-ranking BIR official who also declined to be named said they came out with the collection scheme to compel taxpayers to seek for a temporary restraining order (TR0) before the CTA.

He disclosed the court usually grants such petition upon posting of a bond.

This way, he said, the BIR can confiscate the bond when the taxpayer losses the case and no longer in a position to pay the delinquent account.

The memorandum was issued to the legal service of various revenue regional offices in Metro Manila as well as to the head of the prosecution, appellate and litigation divisions in the national office.

 
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BIR issues controversial seizure warrants

Published December 2, 2019, 12:00 AM

by manilabulletin_admin

By Jun Ramirez 

The Bureau of Internal Revenue (BIR) has come out with a controversial tax enforcement collection strategy which was described by many tax lawyers as unconstitutional.

Bureau of Internal Revenue (MANILA BULLETIN)
Bureau of Internal Revenue (MANILA BULLETIN)

The two-page unnumbered memorandum issued by the agency’s legal service called for the issuance of seizure warrants against the assets of a taxpayer protesting the deficiency tax assessment before the Court of Tax Appeals (CTA).

Tax practitioners argued that under existing regulations, the BIR cannot issue warrant of garnishment when the deficiency tax assessment reaches the tax court.

“The prohibition was a way of upholding the due process right of taxpayers,” said a former tax fraud official who declined to be named.

He added that only the Supreme Court has the final say whether the collection of deficiency taxes becomes “demandable” and “executory.”

A high-ranking BIR official who also declined to be named said they came out with the collection scheme to compel taxpayers to seek for a temporary restraining order (TR0) before the CTA.

He disclosed the court usually grants such petition upon posting of a bond.

This way, he said, the BIR can confiscate the bond when the taxpayer losses the case and no longer in a position to pay the delinquent account.

The memorandum was issued to the legal service of various revenue regional offices in Metro Manila as well as to the head of the prosecution, appellate and litigation divisions in the national office.

 
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