BIR clarifies tax policy on donations | Inquirer News

BIR clarifies tax policy on donations

/ 03:20 PM November 14, 2013

BIR Commissioner Kim Henares. INQUIRER FILE PHOTO

MANILA, Philippines – The Bureau of Internal Revenue (BIR) on Thursday clarified that relief goods both from here and abroad for the victims of monster typhoon Yolanda (international name Haiyan) will be spared from tax as long as it is coursed through the Department of Social Welfare and Development (DSWD) or accredited private foundations.

BIR Commissioner Kim Henares explained that under Republic Act 10121 or the Philippine Disaster Risk Reduction and Management Act of 2010, donations to the national disaster relief and rehabilitation management council is duty-exempt under Section 155.


“Now for the VAT (Value Added Tax), these are VAT exempt but if there’s any VAT, as long as the donation is made to NDRRMC (National Disaster Risk Reduction Management Council), it is going to be paid for by government via tax expenditure,” Henares said.

“So, at the end of the day, there’s really no tax because this is going to be shouldered by the government,” she said.


With regards to donations coming from abroad, Henares said, it has to be donated to relief organizations accredited by the Department of Social Welfare and Development.

“Please coordinate with the DSWD about the VAT because they have a mechanism to address that. Donation to NDRRMC is also duty exempt and if there’s going to be a VAT, it is going to be supported by the GAA (General Appropriations Act),” Henares said.

Some 10 million individuals were affected by the typhoon, with over 2,300 deaths, thus far, according to NDRRMC.

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