CTA denies firm’s petition over P50-M tax deficiency

THE Court of Tax Appeals (CTA) denied the petition of Encore Receivable Management, Inc. to void its P49.61-million deficiency taxes for the taxable year 2014, stating that the global finance company failed to abide by appeal procedures.

In a 12-page decision dated Dec. 6, the CTA Special First Division said the Philippine branch of the international firm failed to file its petition for review on time as called for under the court rules.

The tax court said the firm filed a petition only on April 8, 2019, or past the 30-day window to contest the preliminary collection letter (PCL) and final notice before seizure (FNBS) released by the Bureau of Internal Revenue (BIR) in June 2018.

“[T]he party who intends to appeal must comply with the procedures and rules governing appeals; otherwise, the right of appeal may be lost or squandered,” read part of the ruling penned by Associate Justice Marian Ivy F. Reyes-Fajardo.

Encore Receivable Management contended in its petition that some of its expenses included in its withholding tax on compensation pertain to government contributions, allowances, and other benefits that should be exempted from the said tax.

The BIR argued that aside from the company’s failure to comply with the 30-day window period to file a petition for review, the tax assessments covering 2014 are no longer subject to change. — Jomel R. Paguian