The Court of Tax Appeals (CTA) has approved the amicable settlement of the tax liabilities of a big food and beverage company with the Bureau of Internal Revenue (BIR) amounting to P232 million which included interest and compromise penalties.
The Zest-O Corporation of Caloocan City sought the judicial compromise which was accepted by the BIR to avoid costly and prolonged court litigation.
It was signed by BIR Commissioner Caesar Dulay and Zest-O President Alfredo Yao.
Under the agreement, Zest-O will pay the BIR P78 million to settle the indebtedness that included income, value-added, and documentary stamp taxes for the year 2011.
Sections 7 and 204 of the Tax Code allow the BIR Commissioner to enter into a compromise agreement with taxpayers.
Likewise, the Civil Code and the Revised Rules of Court encourage litigants to enter into fair compromise.