ChanRobles Virtual law Library

A collection of Philippine laws, statutes and codes
not included or cited in the main indices
of the Chan Robles Virtual Law Library

Philippines | Worldwide | The Business Page




WHEREAS, the Bureau of Internal Revenue has launched  an extensive and thorough investigation of income tax  returns for the purpose of ferreting out individuals  who have under-declared their net taxable income for  the years 1974 to 1979;chanroblesvirtualawlibrary

WHEREAS, individuals who, after investigation, are  found to have incorrectly paid their income tax  liabilities for the aforesaid years through deliberate  of failure to report taxable income, willful understatement  of gross income or intentional filing of claims for  fictitious deductions or exemptions, will be assessed  the 50% fraud penalty and thereafter will be prosecuted  for purposes of seeking their conviction; chanroblesvirtualawlibrary

WHEREAS, there is a substantial number of individuals who have evaded payment of income taxes and who are now amenable to the filing of amended tax returns where they  will voluntarily declare their true and correct taxable  income if given the opportunity to do so without the  payment of the corresponding surcharges, penalties and  interests;  chanroblesvirtualawlibrary

WHEREAS, there is an urgent need to up-date the  government's statistics on the assets, liabilities and  net worth of taxpayers in the country for purposes of tax  and economic development planning.

WHEREAS, the statement of assets, liabilities and net  worth filed by taxpayers under Presidential Decrees Nos. 379  and 631 is considered by the government for tax purposes,    as their true and accurate net worth as of January 1, 1974 and  any unexplained increase in their respective net worth  after that date shall be presumed as taxable income in the  year when such increase occurred, was established or discovered.

NOW, THEREFORE, I, FERDINAND E. MARCOS, President  of the Philippines, by virtue of the powers in me vested  by the Constitution do hereby order and decree:  chanroblesvirtualawlibrary

Section 1.    Voluntary Disclosure of Correct Taxable Income. — Any individual who, for any or all of the taxable years  1974 to 1979, had failed to file a return is hereby, allowed to file a return for each of the aforesaid taxable years and  accurately declare therein the true and correct income,  deductions and exemptions and pay the income tax due per  return. Likewise, any individual who filed a false or  fraudulent return for any taxable year in the period mentioned  above may amend his return and pay the correct amount  of tax due after deducting the taxes already paid, if any, in the original declaration.

Section 2.    Coverage. — The provisions of this Decree shall apply income tax liabilities covering the period 1974 to  1979, inclusive, except the following:cralaw:red

a.    Criminal cases already filed in Court or with the Fiscal's Office on or before the effective date  of this Decree;chanroblesvirtualawlibrary

b.    Income tax cases involving civil liability which are the subject of a pending criminal action in the Fiscal's  Office or the Court prior to the effectivity of this Decree;chanroblesvirtualawlibrary

c.    Withholding tax at source liabilities provided for in Sections 53, 54 and Chapter XI of Title II of the National  Internal Revenue Code; and

d.    Deficiency income taxes assessed on or before the effectivity of this Decree.

Section 3.    Time and Manner of Filing of Return and Payment of Tax. — The income tax return, amended or original, shall be filed and the tax due thereon paid in the same manner as provided for under the pertinent  provisions of the National Internal Revenue Code and  Regulations, on or before March 15, 1981.

Section 4.    Payment of Tax on Installment. — If the tax due exceeds P50,000, the same shall be paid in accordance  with the following schedule:cralaw:red

a.    If the amount due exceeds P50,000 but does not exceed P200,000, the tax may be paid in two equal installments,  the first installment to be paid upon the filing of the  return and the second installment, on or before May 15,  1981.

b.    If the amount due exceeds P100,000, the tax may be paid in three equal installments as follows:cralaw:red

i)    The first installment shall be paid upon the filing of the return;chanroblesvirtualawlibrary

ii)    The second installment shall be paid on or before May 15, 1981; and

iii)    The third installment shall be paid on or before June 15, 1981.

c.    If any installment payment is not paid on the due date of said installment, the whole unpaid amount will  become due and demandable and shall be subject to interest and penalties imposed under the Tax Code. The  corresponding letter of demand and assessment notice  shall immediately be issued for the collection of the amount  due and increments thereon.

Section 5.    Immunity from Penalties. — Any individual who voluntarily files a return under this Decree and  pays the income tax due thereon shall be immune from the  penalties, civil or criminal, under the National  Internal Revenue Code arising from failure to pay the  correct income tax with respect to the taxable years  for which an amended return was filed or for which an  original return was filed in cases where no return has  been filed for any of the taxable years 1974 to 1979:  Provided, however, That these immunities shall not apply  in cases where the amount of net taxable income  declared under this Decree is understated to the extent  of 25% or more of the correct net taxable income. chanroblesvirtualawlibrary

Section 6.    Filing of net worth statement. — (a) Persons required to make a statement of net worth. All individuals,  whether a citizen residing in the Philippines or abroad  or any alien residing in the Philippines owning assets  and/or properties amounting to P50,000 or more as of December 31, 1979 and who is not required to file a  statement of assets, liabilities and net worth under  Republic Act No. 3019, as amended by Presidential Decree  Nos. 677 and 1288 shall file a sworn statement of assets, liabilities and net worth as of December 31, 1979.  chanroblesvirtualawlibrary

(b)    When and where to file. — The statement of assets, liabilities and net worth as of December 31, 1979 shall  be filed in the form prescribed on or before April 15,  1981. The statement of assets, liabilities and net worth shall be filed with the Commissioner of Internal  Revenue, Regional Director, Revenue District Officer,  Collection Agent or the authorized Municipal  Treasurer who has been designated as collection officer of the Bureau of Internal Revenue, where the  taxpayer has his legal residence or place of business  in the Philippines, or if he has no legal residence  or place of business in the Philippines, then with  the Commissioner of Internal Revenue. In the case  of non-resident citizens, they may file their statement  with the nearest consular office in the foreign country  where they reside or may file the statement directly  with the Commissioner of Internal Revenue.

Section 7.    Valuation. — (a) Assets. — The value of the assets, whether real or personal shall be the cost thereof if acquired by purchase or the fair market value as of the  date of acquisition if acquired by exchange or by  gratuitous title. If the property is used in trade  or business, the depreciated value as of December 31, 1979  shall be included in the statement. In the case of assets  already declared in the statement of assets and liabilities  filed by the taxpayer pursuant to Presidential Decree No.  379 or 631. The value of such assets as declared therein  shall be used. chanroblesvirtualawlibrary

(b)    Liabilities. — Only liabilities and enforceable obligations reducible in sums of money as of December  31, 1979 shall be included in the statement.

Section 8.    Unlawful divulgence of information. — (a) No information contained in the statement herein required  shall be published except in the form of tabulations  and summaries having no specific reference to the  individual filing the statement.   chanroblesvirtualawlibrary

(b)    Except for internal revenue tax purposes, it shall be unlawful for any officer or employee of the Bureau  of Internal Revenue or any government entity having  knowledge of such declaration of assets, liabilities  and net worth to disclose to any person any information  relative to such declaration and any violation hereof  shall subject such offender to a fine in the amount of  not less than five thousand pesos or imprisonment for  not less than two years, or both, and shall be summarily  dismissed from the service for cause. chanroblesvirtualawlibrary

Section 9.    Penalty for filing false or fraudulent returns. — Any individual who is subsequently found to have  willfully filed false or fraudulent amended return in  cases where an original return has already been filed, or  original return in cases where no return had been filed  for any of the taxable years 1974 to 1979, shall be subject  to the penalties prescribed under Section 73 of the  National Internal Revenue Code.

Section 10.    Penalties for failure to file statement or rendering false or fraudulent statement. — Any individual required to file the statement of assets,  liabilities and net worth under this Decree who knowingly  makes a false declaration or who deliberately fails to comply with any of the provisions hereof, shall upon  conviction pay a fine of not less than Five Thousand  Pesos (P5,000.00) and imprisonment of not less than  two (2) years.

Section 11.    The Ministry of Finance shall, upon the recommendation of the Commissioner of Internal Revenue  promulgate the necessary rules and regulations for  the effective implementation of the provisions of  this Decree.

Section 12.    Effectivity. — This Decree shall take effect upon approval. chanroblesvirtualawlibrary

Done in the City of Manila, this 17th day of September,  in the year of Our Lord, nineteen hundred and eighty.

Back to Home   -  Back to Main

Since 19.07.98

ChanRobles Legal Resources:

ChanRobles On-Line Bar Review

ChanRobles Internet Bar Review :

ChanRobles MCLE On-line

ChanRobles Lawnet Inc. - ChanRobles MCLE On-line :