The Court of Tax Appeals (CTA) has rejected the petition of Philippine Airlines (PAL) to get back P7.4 million in excise tax for filing the claim late.
The court en banc upheld the decision of its Second Division that such claim should be filed within two years upon payment of the tax pursuant to Section 229 of the Tax Code.
Records showed PAL paid the tax in protest on August 22, 2014 for importing wine, liquor, and cigarettes for its commissary.
It filed the claim on August 11, 2020, five years after the deadline.
The court also noted that PAL submitted the administrative and judicial claims simultaneously which is not allowed by the Tax Code.
It said such claim must be filed first with the BIR which will conduct the investigation and later with the court if the petitioner gets unfavorable decision.
Under its franchise (Presidential Decree 1590), PAL is exempt from all taxes, duties, and fees, except corporate or franchise tax of two precent of its annual gross receipts.
The tax exemption privileges have been modified by Republic Act 9337 subjecting under certain condition selected importation to Value-Added Tax.