The Court of Tax Appeals (CTA) has affirmed an order for the Commission on Elections (Comelec) to pay the taxes it did not withhold from its poll technology providers in 2008, although at a reduced rate of P30.65 million.
In an eight-page amended decision dated Jan. 3, the CTA Second Division partially granted the motion for reconsideration against an Aug. 2 decision that pegged its liabilities at P49.08 million.
The court continued to reject the Comelec’s contention that it was exempted as a government office.
But it said the tax exemption under Republic Act No. 9369, or the poll automation law, does not include an exemption from the duty to withhold taxes from income payments to its suppliers.
Yet the Comelec was able to convince the court it was only liable for the basic tax of P30.65 million, and not the interest and penalty.
“The amount of P49,082,867.69 clearly includes the interest and penalty on top of the basic tax due. Accordingly, petitioner must only be liable to pay the basic tax due amounting to P30,645,542.62 and not P49,082,867.69,” the decision read.
The liability arose from the taxes the Comelec should have deducted from its payments to Smartmatic Sahi Technology and Avante International Technology for the lease of vote-counting machines for the 2008 election of the Autonomous Region in Muslim Mindanao.
Justice Juanito C. Castañeda Jr. penned the decision.