THE flagship organization of the Information Technology and Business Process Management industry is hoping that the amended version of Republic Act 11534 will lessen the tax imposed on registered business enterprises particularly slapped by local government units , among others.
One of the proposals of the IT-BPM industry is to reconsider a section in the SB 2654 amending Section 294 of RA 11534, a piece of the measure that aims to impose a 2-percent duty on RBEs availing of the enhanced deduction regime. “With the current wording in the bill, an LGU may still collect other fees, which is actually happening quite a bit these days. And this is just the LGU tax,” Madrid said.“So we propose that the 2 percent should be reconsidered and lowered,” Madrid said adding: “just to provide an example there is one big LGU that is charging .75 percent.” He declined to identify the LGU.
“Our industry relies a lot on equipment composed of PCs and laptops. And it is often the case when these computers are no longer useful to our business even earlier than five years due to the faster rate of obsolescence,” said Madrid. He added that an RBE need not pay taxes and duties due on the book value of the equipment.
This, he asserted, as the current language noted that “RBEs may still be subject to the Bureau of Internal Revenue’s discretion and what they will allow and recognize as VAT zero-rated local purchases of goods and services.”
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