BIR chief Kim Henares warns toll road PUVs vs profiteering

MANILA, Philippines—Any adjustment in the prices of basic commodities and fares in public utility vehicles using the toll roads should not exceed the 12-percent value-added tax, which would be imposed on toll starting Oct. 1, Bureau of Internal Revenue Commissioner Kim Henares said Thursday.

In a news briefing at the Department of Justice, Henares warned bus companies, trucking services and other public transport operators from “taking advantage” of the VAT collection on toll to justify price increases.

Citing her own computation, she said operators of passenger buses using the tollways should only add 1.6 centavos per kilometer on the current basic fare.

“I would like to clarify that it (VAT collection) should not have any significant effect on bus fares or on prices of food because any increase should only be equal to the 12-percent VAT,” Henares said after filing tax evasion cases at the DOJ.

She said jeepney and bus operators who would add more than 12 percent to the basic fare could be held liable for profiteering.

“Anybody (who claims) that the VAT would increase things by more than 12 (percent) is wrong, deceiving the public and taking advantage of the public. I would say it’s profiteering already,” the revenue chief said.

By levying VAT on toll, Henares said the BIR could collect an additional yearly revenue of at least P2.3 billion.

She also clarified that the BIR would start collecting VAT from toll operators even if the Toll Regulatory Board has yet to approve toll hike in South and North Luzon Expressways.

“The VAT on toll is a different issue from the toll hike. Whether or not the toll fare would be adjusted, the VAT collection will still be implemented,” she said.

Without a temporary retraining order from the Supreme Court, Henares said nothing could stop the BIR from imposing the tax measure.

“It’s a general principle in taxation that nobody can stop the collection of taxes except if there is a restraining order from the court,” she stressed.

“A resolution is not a law,” Henares said, apparently referring to the resolution passed by 13 senators opposing the VAT on toll.

Jose Midas Marquez, Supreme Court administrator and spokesperson, agreed with Henares, adding that the pendency of a motion for reconsideration on the matter was not enough to stop the BIR.

“With the lifting of the TRO, the VAT on toll can now be imposed,” Marquez said in a text message.

Almost a year after issuing an injunctive order, the high court voted 11-0 in upholding the constitutionality of the new tax measure last July.

According to Henares, lawmakers should craft a law if they really wanted to stop the BIR from levying toll.

“The law tells us to impose it. The thing there is for the legislative to come up with a new law if they want us to exempt it,” she said.