Solon urges panel to include doctors, lawyers in hearing on BIR detailed income information circular

A lawmaker has called on the House Committee on Ways and Means to
include major stakeholders like doctors, lawyers, and like
professionals and their groups or organizations to serve as resource
persons in the panel’s ongoing hearings on the controversial circular
of the Bureau of Internal Revenue requiring additional detailed income
information from taxpayers.

Rep. Winston Castelo (2nd District, Quezon City) through House
Resolution 1911 said inviting these particular stakeholders to the
committee hearings would be necessary in clearing the issues brought
about by the BIR circular that had been causing worry and apprehension
among taxpayers.

“There is a need to clear the air of much apprehension and fear amidst
warnings from the BIR that may have already sent shark-attack effects
on our political beach especially as it appears to single-mindedly
raise the Sword of Damocles as if it were against our doctors, lawyers
and like professionals who despite contributing their vital role to
nation-building are being unduly scared by the BIR as it threatens to
apply the expenditure method to check, monitor, and do surveillance on
their income sources,” said Castelo.

Castelo said it is of doubtful validity how the form of the so-called
Detailed Income Report would look like and how on the basis of such
document the taxpayers could be held liable for perjury in cases of
inherent inaccuracies in detailing their earnings.

“This is especially amid warnings or advisories of the BIR urging
taxpayers such as doctors, lawyers and like professionals to comply
with tax laws and file their income tax returns,” Castelo said.

A new BIR regulation shall require all taxpayers to render a detailed
income report when they file their income tax returns and such policy
is said to be implemented starting in April 2012 amid opposition
raised by House members assailing, among others, its possible illegal
nature, Castelo said.

“Well-meaning members of Congress have expressed the view that tax
collectors might just be usurping the powers of Congress if they make
impositions other than what the law clearly specifies and more so that
as it compels taxpayers who are not required under the Tax Code to
make a detailed income report to now disclose such information with
the imposition of this reporting requirement in possible contravention
to an existing Bank Secrecy Law,” he said.

Castelo said the BIR or Department of Finance should lay the basis, if
any, of requiring taxpayers to submit a detailed income report along
with their ITR effective April 2012.

The Committee on Ways and Means chaired by Rep. Hermilando Mandanas
(2nd District, Batangas) has been conducting hearings on Revenue
Memorandum Circular 40-2011 on the basis of a letter of Rep.
Magtanggol Gunigundo (2nd District, Valenzuela City) dated October 21,
2011 which states that there is no legal basis for the circular to
stand since law is needed to carry out what the BIR wants under this
new memorandum circular.

Gunigundo said RMC 40-2011 issued by BIR Commissioner Kim
Jacinto-Henares last September basically implements the Annual
Information Return (AIR) that mandates list up of passive income of
taxpayers under Revenue Regulations 2-2011 that was already suspended
last March by Finance Secretary Cesar Purisima, through the efforts of
the House Committee on Ways and Means, by Revenue Regulation 6-2011.


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