Lawmakers buck tax plan revival

BIR Commissioner Kim Henares. INQUIRER FILE PHOTO

The House ways and means committee on Monday assailed Revenue Commissioner Kim Henares for reviving a much-maligned plan to require taxpayers to declare the taxes they had paid on extra income such as stock profits, property gains and prize winnings.

“Not so fast, Commissioner Henares. What you cannot do directly, you cannot do indirectly,” said committee vice chair and Valenzuela City Representative Magtanggol Gunigundo after Henares issued a new memorandum reviving her proposal to require all individual taxpayers to file an Annual Information Return (AIR).

Henares had originally proposed that all taxpayers be required to file an AIR last March but was forced to abandon the plan due to vigorous opposition from taxpayers citing its unconstitutionality.

Gunigundo said the ways and means committee would recommend the withdrawal of the memo once Congress resumes its session next month.

Gunigundo said that Henares issued Revenue Memorandum Circular 20-11 which provides for new income tax return forms for 2011 (due in April next year) requiring in addition the disclosure of a taxpayer’s income that had been subjected to a final tax, such as interest earnings, royalties, prizes, cash and stock dividends, capital gains from the sale of stocks traded outside of the exchange and from the sale of real estate.

Gunigundo pointed out that the Tax Code only provides two instances where the AIR should be filed: On income payments still subject to expanded or creditable withholding taxes and on compensation paid to employees still subject to final withholding taxes.