The Bureau of Internal Revenue (BIR) has revised withholding tax rules in line with the Tax Reform for Acceleration and Inclusion (Train) Law that takes effect today.
In Revenue Memorandum Circular 105-2017, the bureau revised the withholding tax table on compensation pursuant to National Internal Revenue Code amendments introduced by Train Law or Republic Act (RA) 10963.
“With the forthcoming effectivity of RA 10963 on January 1, 2018, it is imperative that a smooth transition as to withholding tax rates is ensured. Thus, for the information and guidance of all concerned, beginning January 1, 2018, every employer making compensation payments to their respective employees shall deduct and withhold from such compensation a tax determined in accordance with the Revised Withholding Tax Table,” the circular, signed by BIR Commissioner Caesar Dulay last Friday, states.
In a separate statement, the bureau added that it was currently in the midst of preparations for Train’s implementation this year.
It is also set to issue various revenue regulations on income, withholding and value added (VAT) taxes; excise taxes on petroleum, automobiles, mineral products, tobacco, sweetened beverages and cosmetic procedures; estate and donor’s taxes; percentage taxes; and documentary stamp taxes.
Expected BIR issuances will also include a revenue memorandum order on the VAT Refund System. Systems on eSales and eReporting will also be established.
Public consultations will be held on January 11 and 12, 2018 to help guide drafters in crafting Train-related directives. Internal briefings will also be conducted from January 24 to 26, 2018.
“The bureau is urging all taxpayers and others concerned to read the provisions of the said law and to participate in discussions of the same in public consultations and briefings to be conducted by the BIR where they can air their views, comments, and recommendations. All these are expected to help in the hassle-free implementation of the law,” the bureau said.
Taxpayers were also enjoined to seek clarifications with the BIR’s national, regional and district office to help the various committees established to craft the implementing rules and regulations of the Train Law.