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FOR those new to my column, I usually write about tax-related topics. You would think writing about tax would be easy, considering that I’m a tax lawyer. However, that is far from the truth. It’s not that I lack material, as there are many taxation topics to choose from. It’s trying to choose a topic that would spark interest in my readers that prove to be challenging.
And what better way to spark interest than to talk about food, and somehow try to connect it to tax? Seems unlikely? Well, just a few months ago, I was amused to receive a positive response to a piece I did about noodles (“Pancit guisado and time-traveling receipts,” Nov. 3, 2019) and the latest guidelines by the Bureau of Internal Revenue (BIR) on invoices or receipts issued by cash register machines (CRMs).
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Lately, while browsing through the BIR website, I came across Revenue Regulations (RR) 10-2019, which provides for a new “BIR Notice to the Public” to be exhibited by businesses at their establishments. For those not familiar what that notice looks like, it is an orange-colored sign with the following written in bold letters: “ASK FOR RECEIPT. This will ensure that the taxes on your purchases will be remitted to the government. It will be used for the development of the Philippines.”
The notice also contains information on the applicable penalties for non-issuance of receipts (two to four years in prison), as well as BIR contact information to report any violators.
As these notices are required to be posted in a conspicuous place, they are usually taped unto the back ends of businesses’ CRMs. Some food establishments, to ensure that their cashiers issue receipts, have this additional notice posted: “If we fail to issue you a receipt, your meal is on us.”
So what are the changes brought about by RR 10-2019? Well, the language is now more direct: “This establishment MUST issue receipt/invoice for each service rendered/sale of goods.” The new notice also requires the establishment to indicate its “Business Name” and “Registered Name,” which refers to the name registered with the Securities and Exchange Commission (SEC) for corporations and partnerships, or with the Department of Trade and Industry (DTI) for sole proprietorships. If the business operates under another name — a Business Name — it is usually prefaced by the statement “doing business under the name and style as.” Thus, a corporation that operates fast food chains may be registered as “Acme Corp.” with the SEC (registered name), but its restaurants are popularly known as “Roadrunner” (business name).
A few observations on RR 10-2019:
— The new notice is better, as it focuses on the obligation of establishments to issue an invoice or receipt. The old notice placed the burden on patrons to ask for an invoice or receipt, making it dependent on them instead of the establishment.
— The new notice is better, as it now distinguishes between an invoice, the document issued for a sale of goods, and a receipt, the document issued for a sale of service.
— The additional requirement of providing the business or registered Name ensures that only duly registered entities may operate a business.
All this talk about BIR notices to the public reminds me of my favorite noodle place in Makati City, the one notorious for not issuing receipts. I have a good mind to pay them a visit, mainly for my pancit guisado fix, but also for me to provide them a copy of RR 10-2019.
Ron Arriesgado is a tax lawyer, transfer pricing specialist and partner at the LMA Law Offices in Makati City. He has managed and resolved taxation issues of local and multinational entities; resolved various tax assessment cases issued by the Bureau of Internal Revenue; and provided clients with the proper tax strategies to cancel or substantially lower tax assessments, among others.