MEMBERS of the Philippine Chambers of Commerce and Industry (PCCI) has also expressed alarmed on the still unresolved tax disputes between Pilipinas Shell Petroleum Corp. (PSPC) and the Bureau of Customs (BOC).
Sergio Ortiz Prtiz-Luis, chairman of PCCI, said they are not against the move of the Bureau of Internal Revenue (BIR) to implement strict rules on taxes since this will be used to fund social services and infrastructure projects of the government, but what alarms them is the “unpredictable changes in public policies affecting business operations in the country.”
Luis stressed that these kinds of policies may “drive away investors.”
“What alarms us is the intent of the new tax policy to take effect in the past, not after formulation,” he said.
He added: “It is a dangerous precedent that violates the principles of law and policy making anywhere. And it is bound to scare further the few potential investors not yet turned off by other negative news about the country.”
Newly-installed BIR Commissioner Joel Tan-Torres issued a memorandum order reversing the previous rulings of the past Commissioners of the Internal Revenue declaring the catalytic cracked gasoline (CCG) being imported by Shell to process unleaded gasoline should not be taxed since its raw materials.
“Business will always make plans based on existing policies at the time of investment. So you don’t change the rules midstream because those are not the policies they started with,” Luis asserted.
With the reversal, Shell is being ordered to pay P7.3 billion back taxes covering the years 2004 up to 2009.
But Shell maintained that paying the P7.3 billion would be double taxation and instead filed a case with the Court of tax Appeal (CTA).
CTA also granted Shell a 60 day temporary restraining order (TRO) to prevent BOC from confiscating their P43 billion CCG imports arriving next month.
Aside from PCCI, the European Chambers of Commerce of the Philippines (ECCP) and the Employers Confederation of the Philippines (ECOP) have similarly expressed their concerns on the tax issue being hurled by the government against Shell.
Shell earlier said they may decide to close their refinery in Batangas if the government will insist on paying the back taxes without due process. (MSN/Sunnex)