Sale of vehicle franchises
THE Bureau of Internal Revenue (BIR) has issued Revenue Memorandum Circular No. 50-2012 prescribing the issuance of certificate of tax clearance to public transportation operators as a pre-requisite for acceptance by the Land Transportation Franchising and Regulatory Board of an application for approval of sale and transfer of a certificate of public convenience.
Pursuant to Executive Order No. 202 dated June 19, 1987, the Land Transportation Franchising and Regulatory Board (LTRFB) has the function, among others, to revise, suspend, or cancel certificates of public convenience (CPCs) or permits authorizing the operation of public land transportation services provided by motorized vehicles.
Relative thereto, Department Order No. 2010-34 was issued by the Department of Transportation and Communications (DOTC) mandating, among others, that no application for the approval of sale and transfer of CPCs shall be accepted unless all fees/dues have been fully paid to the Land Transportation Office (LTO) and LTFRB and taxes to the BIR.
To secure the certificate of tax clearance from the BIR, the operator is now required to submit to the BIR Revenue District Office the following:
(1) Duly accomplished and notarized application form for certificate of tax clearance;
(2) Authorization letter if filed by a representative;
(3) Payment of BIR certification fee;
(4) Payment of the documentary stamp tax; and (5) Copy of the CPC for sale duly certified by the LTFRB.
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