BIR PRIORITIES
* Exceed BIR revenue target of
Volume 10 No. 8
BIR clarifies taxability of insurance
companies
By Aileen Marquez
THE BIR HAS clarified the taxability
of insurance companies with res-
pect to the proper computation of
their Minimum Corporate Income
Tax (MCIT), Business Tax and
Documentary Stamp Tax (DST).
The clarification was initially
made through the issuance of Reve-
nue Memorandum Circular (RMC)
No. 30-2008 last April 1. The Circular
was subsequently amended by RMC
No. 59-2008 last August 23 as a result
of the dialogues and consultations
held by top BIR officials with repre-
sentatives of the insurance industry.
The said Circulars were issued to
help insurance companies understand
the taxability of their various business
Aspe takes oath as full-fledged
Deputy Commissioner
OATH TAKING. DCIR Nelson M. Aspe (middle) takes his oath as full-fledged BIR Deputy Commissioner before Finance
Secretary Margarito B. Teves and Commissioner Lilian B. Hefti last August 28 at the BIR Executive Conference Room.
By Raul Agcaoili
AFTER MORE THAN a year of per-
forming in an Officer-In-Charge
capacity, DCIR Nelson M. Aspe finally
took his oath as full-fledged Deputy
Commissioner for the BIR Operations
Group.
The oath taking ceremony was
administered by Finance Secretary
* Improve taxpayer satisfaction and
* Improve taxpayer and taxfiler base
undertakings that have evolved and
expanded through the years from
generation of premiums from insurance
contracts to conduct of other ancillary
services.
For purposes of computing the
gross income on the sale of services,
which shall be the basis of the 2%
MCIT of life and non-life insurance
companies, the gross revenue shall
include direct premium and reinsurance
assumed (net of returns and cancel-
lations); miscellaneous income; invest-
ment income not subject to final tax;
released reserve; and all other items
treated as gross income under Section
32 of the Tax Code, as amended.
The costs of services or direct cost
and identifiable direct revenue-related
deductions of insurance companies
Margarito B. Teves last August 28 at
the BIR Executive Conference Room
before the start of the monthly
executive meeting with the Secretary.
The ceremony was witnessed by
Commissioner Lilian B. Hefti, the
Deputy Commissioners and other
top revenue officials.
DCIR Aspe is a CPA-lawyer who
Aspe takes... to p. 2
P 845 Billion for 2008
compliance
shall refer to those incurred costs
which are exclusively related or other-
wise considered indispensable to the
creation of the revenue from their
business activity as an insurance
company, including the generation of
investment income not subject to final
taxes.
The said direct costs and revenue-
related deductions shall be limited to the
following: salaries, wages and other
employee benefits of personnel directly
engaged in underwriting, claims and
BIR clarifies ... to p. 2
BIR adopts new
procedures to
stop spurious
input tax claims
By Eleonor Capili
IN ORDER TO stop the illegal use of
Official Receipts/Sales Invoices (OR/SI)
of dissolved business establishments
in claiming input taxes, the BIR issued
Revenue Memorandum Circular (RMC)
No. 56-2008 last August 20 to clarify the
procedures on the processing of appli-
cation for cancellation of business
registration.
Pursuant to the Circular, upon filing
of the duly accomplished Notice of
Closure or Cessation of Business, the
taxpayer shall submit to the BIR, for
evaluation, the establishments list of
inventory of goods, supplies and capital
goods; list of unused ORs, SIs and other
accounting forms; and list of certificates,
permits, notices, etc. issued to the
taxpayer by the BIR.
Upon effectivity of the closure or
cessation of business, the taxpayer shall
submit and/or surrender to the BIR
(through the Revenue District Office
BIR adopts... to p. 2
2 NATIONAL
BIR clarifies ...from p. 1
benefits, actuary and policy owner
services; commissions on direct writings/
reinsurance; cost of facilities directly
utilized in providing the service such as
depreciation or rental of equipment used
and cost of supplies; inspection and
medical fees; claims, losses, maturities and
benefits net of reinsurance recoveries;
additions required by law to reserve fund;
and reinsurance ceded.
Investment expenses shall not form
part of the direct cost nor a deductible
expense in the determination of the net
taxable income. However, investment
expenses relating to investment income
that has not been subjected to final tax,
although not forming part of the direct
cost, shall be allowed as deduction to
arrive at the taxable income.
The taxability of the various
Aspe takes...from p. 1
joined the BIR in 1989 as Revenue
Examiner at the Value-Added Tax Divi-
sion. Because of his competence and
dedication to the revenue service, he rose
from the ranks and assumed various
important positions in the Bureau.
Prior to his designation as OIC-
Deputy Commissioner, Atty. Aspe
BIR adopts ...from p. 1
where the taxpayers head office is
registered) all unused ORs, SIs and
other accounting forms, for destruc-
tion. Likewise, all BIR-issued Notices,
Permits, Certificate of Registration, etc.
shall also be surrendered, for
cancellation.
Commissioner Lilian B. Hefti direc-
ted taxpayers to properly dispose the
128 Bacolod ...from p. 3
training program for the Collection
Group and Assessment Group, res-
pectively, which both started last
February.
The pool of lecturers, led by
Regional Director Rodita Galanto and
Assistant Regional Director Aynie
Mandajoyan, discussed various
topics in taxation, such as collection
and audit procedures for Income Tax,
Percentage Tax, Value-Added Tax,
Transfer Tax, Excise Tax and Docu-
mentary Stamp Tax.
The participants were also trained
on how to improve their communication
business activities of life insurance
companies for business tax (whether
premium tax, Value-Added Tax [VAT] or
Gross Receipts Tax [GRT]) and DST was
clarified, particularly those pertaining to
the following types of income: direct
writings/premiums; management fees,
rental income, or other income/fees; and
investment income realized from the
investment of premium earned and those
realized from the investment of funds
obtained from others. The manner of
apportionment of investment income to
determine which portion is exempt and
which portion is subject to the GRT was
also clarified.
In RMC No. 59-2008, it was empha-
sized that premium on Health and
Accident Insurance, whether received
by a life or non-life insurance com-
pany, shall be considered as premium
served as Chief of Staff at the Office
of the DCIR, Operations Group for
five years and as Regional Director
of RR 8- Makati for almost a year.
DCIR Aspe was a member of the
VAT Review Committee and has been
actively involved in the drafting of
various important Revenue Regulations
issued by the BIR, as well as in the
destroyed/cancelled documents and
warned them that they shall be held
liable if the said documents are sub-
sequently used as a source of spurious
input taxes.
The BIR will issue another RMC to
circularize the names of taxpayers who
have ceased business operations. (For
more details, see full text of RMC No.
56-2008 at www.bir.gov.ph)
skills and customer assistance skills to
further improve their delivery of service
to taxpayers.
The GCRO topnotchers who were
recognized during the graduation
ceremony are Arlen Amarador, Gene
Rose Gallo and Ma. Riza Ramos (for the
Collection Group); and Ma. Anna Liza
Valencia, Grace Rikelle Lapu-os and
Monina Mata (for the Assessment
Group).
Assistant Commissioner Leonor
Villalon-Rogers from the Bureaus
Human Resource Development Service
graced the graduation ceremony as
guest speaker. (By Lizelda Lofranco)
on life insurance subject to Premium
Tax and not VAT. The said RMC also
clarified that the re-issuance fees,
renewal fees as well as penalties paid
to the life insurance company are
likewise considered as income of the
life insurance company for services
rendered to customers and, therefore,
subject to VAT or Percentage Tax,
whichever is applicable.
The RMCs likewise clarified the
taxability of other financial services/
products sold by the life insurance
companies, namely: the Variable Unit
Link and the Premium Deposit Fund, as
well as the taxability of non-life in-
surance companies insofar as the
business taxes and DST are concerned.
(For more details, see full text of
RMC Nos. 30-2008 and 59-2008 at
www.bir.gov.ph)
conduct of campaign for the imple-
mentation of the Expanded VAT Law.
DCIR Aspe also serves as the
Director of the Philippine Institute of
Certified Public Accountants (PICPA),
Eastern Metro Manila Council; Direc-
tor of the CPA-Lawyers Association of
the Philippines; and Director of the BIR
CPA-Lawyers Society.
BIR searches ...from p. 5
Search.
Said revenuers were nominated
based on their outstanding performance/
contribution to the revenue service;
behavioral performance (i.e. commitment
to public service, professionalism, just-
ness and sincerity, responsiveness to
public and simple living); reliability and
consistency of performance, and other
similar circumstances or considerations
in favor of the nominee.
From the 16 official nominees, the
top eight (8) nominees shall be deter-
mined by the Preliminary Board of
Judges consisting of the Commissioner,
Deputy Commissioners of Operations
Group and Resource Management
Group and other officials authorized by
the Commissioner.
The 8 finalists shall then be referred
to the Final Board of Judges (FBJ) to be
constituted by TMAP. The FBJ shall
select 1 winner, which shall be an-
nounced and awarded on October 21.

Bacolod region recognizes top taxpayers
and withholding agents
By Lizelda Lofranco
RR 12, BACOLOD CITY The Regional
Office recognized its top taxpayers and
withholding agents during the regional
celebration of the BIR 104th founding
anniversary held last August 8 at the
Provincial Multi-Purpose Gymnasium in
Bacolod City.
The awardees are top taxpayers of
the four Revenue District Offices
(RDOs) of RR 12, namely: RDO Nos. 76
Victorias City, 77 Bacolod City, 78
Binalbagan and 79 Dumaguete City.
The taxpayer-awardees were selected
because of their correct and timely
payment of taxes and/or remittance of
withholding taxes, which contributed
significantly to the regions good
collection performance in CY 2007.
Awarded as Top Individual Tax-
payers were Isidoro Be; Ramon and
Yolando Kilayko; Benjamin Jalandoni;
and Sylvia Uy. The Top Corporate
Taxpayers were Sagay Central, Inc.;
Va l l a c a r Tr a n s i t , I n c . ; G a n e t
Cebu region participates in
job fair
By Judith Mondigo
RR 13, CEBU CITY The region
participated in the Career and Entre-
preneurship Fair organized by JobsDB
Philippines, Inc. Cebu last July 10 and
11 at SM City Cebu.
The said Fair aimed to provide job
opportunities for the unemployed and
to encourage more people to enter into
entrepreneurship to spur the estab-
lishment of small- and medium-scale
businesses in the region.
Revenue officials and employees
from the Taxpayer Service Section of
Revenue District Office Nos. 80
Mandaue City, 81 Cebu City North, 82
Cebu City South and 83 Bulacao,
Talisay City manned a booth where
jobseekers and entrepreneurs submitted
their applications for Taxpayer Iden-
tification Number (TIN) and registration
requirements for business.
During the Fair, revenuers also
REGIONAL
TOP TAXPAYER: Ramon E. Kilayko ( 3rd from left) receives the Plaque of Recognition from BIR officials (L-R) Revenue
District Officer (RDO) Jonah Ruth Alonte, Asst. Commissioner Leonor Villalon-Rogers, OIC-Regional Director Rodita
Galanto, OIC-Asst. Regional Director Aynie Mandajoyan and OIC-Asst. RDO Lily Lopez.
Management Corporation; and ACM
Commodities, Inc.
The Top Withholding Agents in
the private sector were VCM Rural
Electric Service Cooperative, Inc.;
Mandalagan Commodities, Inc.; Negros
Occidental Electric Co.; and Siliman
University. The Top Withholding
Agents in the government sector were
City Government of Sagay; Department
of Education - Negros Occidental;
JOB FAIR. Manning the BIR booth during the Career and
Entrepreneurship Fair held last July 10 and 11 at SM City-
Cebu are (L-R) Amelia Montero, Alan Bayawa, Samuel
Capada and Marivic Meoso.
distributed flyers on the Bureaus
Premyo Sa Resibo (PSR) raffle promo
and other tax information materials as
part of their tax campaign activities for
the year.
Regional Director Jose Tan and
Asst. Regional Director Teresita Dizon
expressed optimism that through the
BIRs participation in the Fair, the region
will be able to expand its taxpayer base
as well as reach out to more taxpayers,
which will eventually lead to increased
tax collections.
3
Province of Negros Occidental;
Department of Public Works and
Highways, 4th Engineering District; and
Department of Education - Negros
Oriental.
Regional Director Rodita Galanto
led the awarding ceremony, together
with Assistant Commissioner Leonor
Villalon-Rogers, Asst. Regional Director
Aynie Mandajoyan and the four
Revenue District Officers of the region.
128 Bacolod
revenuers
finish General
Course for ROs
RR 12, BACOLOD CITY The region
culminated its conduct of the General
Course for Revenue Officers (GCRO)
with a graduation ceremony held last
August 7.
A total of one hundred twenty-eight
(128) revenuers composed of 73
Collection and Seizure Agents and 55
Revenue Officers from the Assessment
Division, Special Investigation Division
and Revenue District Offices of
Victorias, Bacolod, Binalbagan and
Dumaguete City attended the course.
The GCRO is a training package
being conducted to hone the collection
and audit skills of revenuers assigned
in tax assessment and collection
positions. It is an 87-hour and 178-hour
128 Bacolod ... to p. 2
4 FEATURES
New Revenue Issuances
RR No. 8-2008 Clarifies that the
transactions of Bangko Sentral ng
Pilipinas entered into in the exercise of
its governmental/regulatory authority
are outside of the coverage of the
Gross Receipts Tax
RMO No. 28-2008 Prescribes the
policies, guidelines and procedures in
the reporting, recording, and monito-
ring of attendance of revenue officials
and employees
RMC No. 43-2008 Authorizes the
manual filing of tax returns of tax-
payers enrolled in Electronic Filing
and Payment System (eFPS) due to
technical problems encountered
RMC No. 44-2008 Circularizes the full
text of Department Order No. 9-08
relative to the implementing rules and
regulations on the accessibility of
taxpayer information between the BIR
and the LGUs for tax collection pur-
poses
RMC No. 45-2008 Circularizes the list
of Tax Credit Certificates and Disburse-
ment Vouchers for tax refunds issued
for the month of May 2008
RMC No. 46-2008 Clarifies issues
concerning common carriers by air and
their agents relative to the revenue and
receipt from transport of passengers,
goods/cargoes and mail and from
excess baggage
RMC No. 47-2008 Prescribes the
procedures in handling taxpayers
request for transfer of registration
RMC No. 48-2008 Circularizes the list
of Tax Credit Certificates and Disburse-
ment Vouchers for tax refunds issued
for the month of June 2008
RMC No. 49-2008 Clarifies the com-
position of the National Evaluation
Board
RMC No. 50-2008 Notifies the loss of
triplicate copy from one set of unused
BIR Form No. 2320 Tax Credit Certi-
ficate with Serial No. 012832
RMC No. 51-2008 Circularizes CSC
Memorandum Circular No. 03, s. 2001
entitled Revised Policies on Merit
Promotion Plan
RMC No. 52-2008 Circularizes Memo-
randum Circular No. 04, s. 2005 entitled
Amendment to Policy No. 12 of CSC
MC No. 3, s. 2001 and Clarification of
the Functions and Responsibilities of
the Personnel Selection Board
RMC No. 53-2008 Notifies the loss of
1 pad of unused Accountable Form No.
51 (AF51)
RMC No. 54-2008 Circularizes the list
of Tax Credit Certificates and Dis-
bursement Vouchers for tax refunds
issued for the month of July 2008
RMC No. 55-2008 Provides the dead-
line of corporate taxpayers for the filing
of 2nd Quarter Income Tax return and
clarifies the procedure in the filing of
tax returns, among others
RMC No. 56-2008 Clarifies the proce-
dure on the handling of taxpayers
application for cancellation of business
registration and issues warning on the
use of Official Receipts/Sales Invoices
of dissolved businesses for purposes
of claiming input taxes
Happy
Happy Birthday
Birthday
Chief Pedro D. Ramos Aug. 01
RDO Cynthia T. Cabuguas Aug. 01
Chief Ruth C. Bagaloyos Aug. 02
OIC-Chief Simeon D. Abella Jr. Aug. 02
Asst. Chief Oswaldo C. Adornado
ARDO Carlos G. Tambal
Aug. 04
Aug. 04
Chief Nona P. Gatbonton Aug. 05
OIC-RDC Head Victor O. Baylon Aug. 05
OIC-Asst. Chief Rhoda A. Virganio Aug. 05
OIC-Chief Bobby U. Labajo
OIC-Asst. Chief Nicanor S. Ventura
Aug. 06
Aug. 06
OIC-Asst. Chief Bernardo D. Gomez Aug. 06
OIC-Chief Cynthia A. Fuentes Aug. 08
RDO Gerry O. Dumayas Aug. 10
ARDO Ester M. Campos
OIC-Reg. Dir. Ma. Nieva A. Guerrero
Aug. 10
Aug. 12
OIC-ARDO Benjamin B. Virtucio Aug. 12
Chief Claire F. Corpus Aug. 13
RDO Ramer D. Narvaez Aug. 13
Chief Marcelina P. Tawanna
Asst. Reg. Dir. Mamapok G. Diro
Aug. 14
Aug. 15
Chief Asuncion E. Bernades Aug. 15
RMC No. 57-2008 Notifies the loss of
2 sets of unused BIR Form No. 2524
Revenue Official Receipt
RMC No. 58-2008 Clarifies the time
within which to reckon the redemption
period on foreclosed asset and the
period within which to pay Capital Gains
Tax or Creditable Withholding Tax and
Documentary Stamp Tax on the foreclo-
sure of real estate mortgage by those
governed by the General Banking Law
of 2000, as well as the venue for the
payment of these taxes
RMC No. 59-2008 Amends certain
portions of RMC No. 30-2008 on the
taxability of insurance companies for
Minimum Corporate Income Tax, Busi-
ness Tax and Documentary Stamp Tax
purposes
RMC No. 60-2008 Notifies the loss of
several Revenue Official Receipts-BIR
Form No. 2524
RMC No. 61-2008 Encourages par-
ticipation to the celebration of the 19th
National Statistics Month in October
2008
RMC No. 62-2008 Notifies the loss of
4 sets of unused BIR Form No. 1954 -
Certificate Authorizing Registration
RDO Isidro T. Casals, Jr. Aug. 15
RDO Nerissa C. Agraam Aug. 15
OIC-Chief Renato L. Ruiz Aug. 15
OIC-RDO Evangeline S. Abanilla Aug. 15
RDO Ramon T. King Jr. Aug. 17
Chief Nelly S. Ibo Aug. 18
OIC-RDO Roberto S. Bucoy Aug. 18
Asst. Chief Gregoria A. Pacho
OIC-Chief Alice SA Gonzales
Aug. 19
Aug. 20
Chief Evelyn M. Albano Aug. 21
Asst. Chief Yolanda C. Magsumbol Aug. 22
Chief Oscar R. Maalac Aug. 24
OIC-Chief Erotida M. Sibal Aug. 24
ARDO Danilo G. Lino Aug. 24
OIC-RDO Maria Thelma F. Pulhin
OIC-RDO Noel B. Gonzales
Aug. 25
Aug. 27
OIC-Asst. Chief Lizabel M. Valderama Aug. 28
ARDO Roger G. Cadavas Aug. 29
OIC-Asst. Reg. Dir. Teresita M. Dizon Aug. 30
OIC-ACIR Jaime B. Santiago
Asst. Chief Ariel M. Calabia
Aug. 31
Aug. 31
Asst. Chief Neil U. Cordero Aug. 31
BIR searches for Exemplary Revenue Employee
By Beverly Samia
THE BIR, in partnership
with the Tax Management
Association of the Philip-
pines (TM-AP) launched
last June 26 the Search for
Exemplary Revenue Emplo-
yee of 2008 to recognize
BIR employees who have
displayed outstanding
work performance and
dedication to duty.
The Search is open to
all BIR employees, exclu-
ding those who are holding
Division Chief/Revenue
District Officer positions
and above. However, in the
initial conduct of the
Search, it shall cover only
the Revenue Regions and
Revenue District Offices
within Metro Manila,
including the BIR National
Office and the Large Tax-
payers Service (excluding
LTDO-Cebu). Subsequently,
the Search shall cover the
areas outside Metro Manila.
To qualify for the Search,
the nominee must be an em-
ployee of the BIR for at least
seven (7) years at the time of
nomination; must be rated
Very Satisfactory under the
PMS for the immediately pre-
ceding six consecutive per-
formance rating periods prior
to their nomination con-
ducted during the last three
years; must not have been
charged under a criminal
information pending in court
or must not have any pen-
ding criminal and/or admi-
nistrative case/charge; and
must not have been adjudged
guilty/liable in any admi-
nistrative or criminal case.
Based on the nomina-
tions received by the
Search Committee, sixteen
(16) revenuers were offi-
cially nominated to the
BIR searches ... to p.2
Rowena G. Altura
Editor-in-Chief
Silverio C. Sante
Managing Editor
Eleonor F. Capili
News Editor
Mary Aileen F. Marquez
Writer
Beverly C. Samia
Brando Ador C. Bautista
Layout Artists
The BIR Monitor is the
official newsletter of the
Bureau of Internal Revenue
published by the
Corporate Communications
Division, under the
supervision of the Policy
and Planning Service.
Editorial Office: Room 903,
BIR National Office,
Agham Road, Diliman,
Quezon City
Tel/Fax No. 426-2190