Saturday, August 9, 2014

BIR: Taxes on benefits of gov't workers specified in Internal Revenue Code

Bureau of Internal Revenue chief Kim Henares denies accusations she usurped Congress' power to legislate when she issued Revenue Memorandum Order 23-2014.
Henares explains the order, which taxes thirteenth month pay and other benefits of state employees, merely clarifies provisions that are already in the Internal Revenue Code passed in 1997.
Henares also rejects speculation the controversial order targeted the judiciary's employees in retaliation for the Supreme Court's ruling on the Disbursement Acceleration Program (DAP).
"Kapag binasa niyo 'yung RMO ko, wala naman ako...kinover ko lahat eh: constitutional bodies, legislative, judiciary. Wala naman akong sinabing Supreme Court lang. At saka in-issue 'yang RMO na yan, kailan ho? 'Yung ruling ng Supreme Court na DAP, kailan ho lumabas? Secondly, ano naman pakialam ko sa kanila?" Henares says.
Gov't workers protest taxes on allowances, benefits
On Wednesday, government workers called on the Supreme Court to intervene to stop the BIR order on their taxes. Wearing red and black ribbons, employees of the Supreme Court and the lower courts staged a rally at the high court grounds.
The group laments how government is after ordinary employees like them who are living on meager pay.
They said that instead of increasing taxes, the government should raise the wages of all state workers.
But Henares says she is just implementing the Internal Revenue Code. She also clarified that below-minimum wage earners are expempted from certain taxes.
"My mandate is to implement this law. I'm deaf, mute, blind to all the noise around me. There are exemptions, of course. If you're a minimum wage earner, you're exempted from tax," Henares says.(For more information on how to compute, play this video of the Henares guesting at the 9:37 mark)
Henares warns against raising ceiling of taxable pay
Meanwhile, Henares warns against some law makers' moves to raise the ceiling of taxable income from the current P30,000 to P75,000.
She says doing so would reduce government revenues and its capability to deliver services to the people.
"This is the only position I have. When you try to pass a law, the Bureau of Internal Revenue will only come out and say 'Okay, if you pass this law, this means we will not be able to collect this much. If we will not be able to collect this much, you lower our goal by this much.' Because where will we get it? It's now an impossible goal. Before, it was difficult. It's now impossible. If you lower our goal, that means your expenditure for government will be lower. Then when you lower your expenditure, you have to choose which programs you will not fund. You have to decide who will make the sacrifice. Now, if everyone is clear and all these things are acceptable to everyone, then there's no quarrel," Henares says.

source:  Yahoo!

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