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By Efren L. Danao, Senior Reporter
Sen. Mar Roxas said Tuesday the Trade Union Congress of the
Philippines and he would contest before the Supreme Court the
decision of the Bureau of Internal Revenue (BIR) pegging to July 6,
2008 the effectivity date of Republic Act 9504, the new law
exempting minimum wage earners from paying income tax.
Roxas said the implementing rules and
regulations promulgated by the BIR and approved by the Department of
Finance is contrary to the legislative intention to make the law
retroactive to January 1, 2008.
“As principal author of the law, I will oppose
this misinterpretation by the executive department,” he said.
He said that each minimum wage earner would lose
P5,000 in exemptions from January to June with the “erroneous”
implementing guidelines on the law.
Sen. Francis Escudero, chairman of the Senate
Committee on Ways and Means, agreed with Roxas that the BIR and the
Department of Finance (DOF) erred in making the new law applicable
starting from July 6, 2008.
High Court already had set precedent.
He said the Supreme Court had already decided
that when the law does not provide for a prospective application, it
retroacts to the start of the taxable year after the completion of
its publication in a newspaper of general circulation or the
Official Gazette.
He and his House counterpart, Rep. Exequiel
Javier of Antique, had already written a letter to Finance Secretary
Margarito Teves stressing the legislative intent of making the law
retroactive to January 1, 2008. Roxas wrote a similar letter to
Teves last week.
“We are still waiting for the reply of DOF but
we would be filing a petition before the Supreme Court to start the
process of scrapping the half-baked income tax exemption that BIR
wants,” Roxas said.
Escudero said that Teves was earlier sympathetic
to their plea but backtracked because this would make it more
difficult for the BIR to reach its revenue target. The new law would
result in foregone revenues amounting to P14 billion.
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