Sunday, September 28, 2008 6 more months' tax cut sought
SEN. Manuel Roxas II yesterday said he will petition the Department of Finance (DOF) and the court to make the tax exemption on minimum wage earners retroactive to January this year, not July.
However, he will not ask for a temporary restraining order because the Bureau of Internal Revenue (BIR) may use it as a reason not to give the exemption for July, June and September, he said.
The BIR has already issued the implementing rules and regulations (IRR) for Republic Act 9504, which exempts minimum wage earners from paying income taxes.
“Let’s just allow the BIR to (give the exemption) beginning July so what will be discussed in my petition is from January to June 2008 only,” Roxas said.
The senator was interviewed during an anti-corruption forum at the Pagtambayayong Foundation Inc. office in Barangay Sambag I, Cebu City.
He said that if his petition gets approved, the BIR will have to refund the withholding taxes collected from January to June this year.
“The legislative intent here is that the exemption should start in January (2008), so that I will file a petition with the DOF and the court, (even up to)…the Supreme Court, so I can show the congressional records that will prove that it should be in January and not in July,” Roxas said.
While the BIR may have a different interpretation, as principal author of the law, he is sure that the exemption should be granted starting January 2008.
“For me, the BIR erred in exempting the minimum wage earners beginning July onwards,” Roxas said.
He said he already wrote a letter to the BIR informing the agency of his complaint the other day.
“That is the process. You cannot pole-vault to the court. The court will say you first exhaust administrative remedies. So, first we have to go to the BIR to complain, (then) to the DOF, and then we go to court,” Roxas said.
Earlier, lawyer Jonathan Capanas, University of San Jose-Recoletos College of Law dean, told another forum that the tax exemption will also result in distortions of most workers’ take-home pay.
Capanas said the BIR meant the income tax exemption for those receiving compensation not exceeding P10,000 per month or P120,000 a year.
This, he said, means those receiving P10,000 a month will get a bigger take-home pay than those receiving more than P10,000 in pay, who are not covered by the exemption. (EOB)
