MANILA, Philippines – The Philippine Charity Sweepstakes Office (PCSO) has agreed to settle more than P3.5 billion in tax debts with the Bureau of Internal Revenue (BIR).
BIR Commissioner Kim S. Jacinto-Henares said yesterday that the amicable settlement was reached after PCSO Chairwoman Margarita P. Juico went to the BIR in Quezon City last Monday to discuss and end the dispute.
Under the accord, Henares said the PCSO will pay on installment basis, starting with the undisputed assessments made by the Large Taxpayers Service (LTS) of the bureau.
Among them is the Documentary Stamp Tax (DST) deficiency assessments from 2007 to 2010 amounting to more than P1 billion.
Henares said no less than the Supreme Court (SC) had ruled that the PCSO is liable to pay DST on the sale of lotto tickets.
The balance of the tax debts covers mostly deficiency withholding taxes due from the salary of PCSO workers and expanded withholding taxes due from the agency’s suppliers of goods and services.
The DST deficiencies arose from the wrong computation of the PCSO of the tax on the sale of lotto tickets based on the net sales (after deducting expenses on rentals of ticket booths and other operational expenses) instead of the gross price of the ticket as required by the Tax Code.
Henares revealed that only minor issues remained unsettled such as reconciliation and justification of charity funds earmarked for various projects that are subject to withholding tax. (Jun Ramirez)