EXECUTIVE ORDER NO. 41
EXECUTIVE ORDER NO. 41 - DECLARING
A ONE-TIME TAX AMNESTY COVERING UNPAID INCOME TAXES FOR THE YEARS 1981
TO 1985
WHEREAS, to raise more revenues,
certain income tax evaders should be encouraged to declare voluntarily
their untaxed income and pay the tax due thereon;
WHEREAS, the grant to a tax amnesty to the said income tax evaders will
greatly contribute to the attainment of the aforesaid objective;
WHEREAS, to impress upon the taxpayers that henceforth the government
will vigorously enforce the tax laws, no further amnesties shall be
granted.
NOW, THEREFORE, I CORAZON C. AQUINO, President of the Philippines, do
hereby order:
Section 1. Scope of Amnesty. — A one-time tax amnesty
covering unpaid income taxes for the years 1981 to 1985 is hereby
declared.
Sec. 2. Conditions of the Amnesty. — A Taxpayer
who wishes to avail himself of the tax amnesty shall, on or before
October 31, 1986:
a)
file a sworn statement declaring his networth as of December 31, 1985;
b) file a
certified true copy of his statement declaring his net worth as of
December 31, 1980 on record with the Bureau of Internal Revenue, or if
no such record exists, file a statement of said net worth therewith,
subject to verification by the Bureau of Internal Revenue;
c) file a
return and pay a tax equivalent to ten per cent (10%) of the increase
in net worth from December 31, 1980 to December 31, 1985: Provided,
That in no case shall the tax be less than P5,000.00 for individuals
and P10,000.00 for juridical persons.
Sec. 3.
Computations of Networth. — In computing the networth referred to in
Sec. 2 hereof, the following rules shall govern:
a)
No-cash assets shall be valued at acquisition cost.
b) Foreign
currencies shall be valued at the rates of exchange prevailing as of
the date of the net worth statement.
Sec. 4. Exceptions. — The following taxpayers may
not avail themselves of the amnesty herein granted:
a)
Those falling under the provisions of Executive Orders Nos. 1, 2 and 14;
b) Those with
income tax cases already filed in Court as of the effectivity hereof;
c) Those with
criminal cases involving violations of the income tax law already filed
in court as of the effectivity hereof;
d) Those that
have withholding tax liabilities under the National Internal Revenue
Code, as amended, insofar as the said liabilities are concerned;
e) Those with
tax cases pending investigation by the Bureau of Internal Revenue as of
the effectivity hereof as a result of information furnished under
Sec. 316 of the National Internal Revenue Code, as amended;
f) Those with
pending cases involving unexplained or unlawfully acquired wealth
before the Sandiganbayan;
g) Those
liable under Title Seven, Chapter Three (frauds, Illegal Exactions and
Transactions) and Chapter Four (Malversation of Public Funds and
Property) of the Reversed Penal Code, as amended.
Sec. 5. Schedule of Payment Amnesty Tax. — The
amnesty tax imposed herein shall be paid as follows:
a)
If P50,000.00 or less, the tax must be paid at the time of the filing
of the return, but not later than October 31, 1986;
b) If more
than P50,000.00 but not exceeding P500,000.00 the tax may be paid in
two equal installments: the first, upon the filing of the return but
not later than October 31, 1986; and the second, on or before November
30, 1986.
c) If more
than P500,000.00, the tax may be paid in three equal installments: the
first, upon the filing of the return but not later than October 31,
1986; the second, on or before November 30, 1986; and last, on or
before December 31, 1986.
If the amnesty tax or any installment thereof is not paid on its due
date, a surcharge equivalent to 25% of the unpaid amount shall be
collected. The unpaid tax or installment and the surcharge shall be
paid not later than one month from the due date thereof, otherwise the
application for tax amnesty shall be denied. No case hereunder shall
result in a refund.
Sec. 6. Immunities and Privileges. — Upon full
compliance with the conditions of the tax amnesty and the rules and
regulations issued pursuant to this Executive Order the taxpayer shall
enjoy the following immunities and privileges:
a)
The taxpayer shall be relieved of any income tax liability on any
untaxed income from January 1, 1981 to December 31, 1985, including
increments thereto and penalties on account of the non-payment of the
said tax. Civil, criminal or administrative liability arising from the
non-payment of the said tax, which are actionable under the National
Internal Revenue Code, as amended, are likewise deemed
extinguished.
b) The
taxpayer’s tax amnesty declaration shall not be admissible in evidence
in all proceedings before judicial, quasi-judicial or administrative
bodies, in which he is a defendant or respondent, and the same shall
not be examined, inquired or looked into by any person, government
official, bureau or office.
c) The books
of account and other records of the tax payer for the period from
January 1, 1981 to December 31, 1985 shall not be examined for income
tax purposes: Provided, That the Commissioner of Internal Revenue may
authorize in writing the examination of the said books of accounts and
other records to verify the validity of correctness of a claim for
grant of any tax refund, tax credit (other than refund on credit of
withheld taxes on wages), tax incentives, and/or exemptions under
existing laws.
Sec. 7. Treatment of Unexplained Increase in
Networth after December 31, 1985. — The net worth of the tax- payer as
declared in the statement filed by him pursuant to Sec. 2(a) hereof
shall be considered as his true net worth as of January 1, 1986 for
purposes of determining his future tax liabilities. Any unexplained
increase in his net worth after January 1, 1986 shall be considered
taxable income in the year when such increase was established or
discovered.
Sec. 8. Unlawful Divulgence of Amnesty Tax Return
and Statement of Assets and Liabilities. — Except as otherwise provided
herein, it shall be unlawful for any person having knowledge of the tax
amnesty declaration containing the statement of assets, liabilities and
net worth filed pursuant hereto, to disclose any information relative
to such declaration, and any violation hereof shall subject the
offender to a fine in the amount of not less than FIVE THOUSAND PESOS
(P5,000.00) or imprisonment of not less than two (2) years nor more
than five (5) years, or both.
Any officer or employee of the Bureau of Internal Revenue or any
government entity who inquires, questions or attempts to inquire into
the amnesty declaration filed by any taxpayer pursuant to this
Executive Order shall be guilty of grave misconduct for which he may
summarily be dismissed from the service.
Sec. 9. The Minister of Finance, upon the
recommendation of the Commissioner of Internal Revenue, shall
promulgate the necessary rules and regulations to implement this
Executive Order.
Sec. 10. Upon expiration of the period of this
amnesty, no further income tax amnesty shall be granted.
Sec. 11. This Executive Order shall take effect
immediately.
Done in the City of Manila,
this 22nd day of August, in the year of Our Lord nineteen hundred and
eighty-six.