MANILA — The Bureau of Internal Revenue has been told not to issue preliminary and final assessment notices and other administrative matters related to Revenue Regulations No. 4-2011 that imposes restrictions on bank tax deductions.
The Makati City Regional Trial Court Branch 57 reiterated the prohibition in an order dated June 10.
The court issued the injunction following the petition filed by the Bankers Association of the Philippines (BAP).
“Should there be distraint and levy, the banks will be deprived possession of their properties, effectively crippling their business operations,” BAP said in their petition.
The petition was filed to nullify RR 4-2011 after the BIR started issuing PANs on several banks.
Petitioner banks include Asia United Bank; BDO Unibank Inc.; Bank of America; Bank of Commerce; BDO Private Bank Inc.; Citibank, N.A., Philippine branch; China Banking Corp.; Chinatrust (Phils.) Commercial Bank Corp.; Deutsche Bank AG, Manila Branch; East West Banking Corp.; ING Bank N.V., Manila branch; Philippine Bank of Communications; Philippine National Bank; Philippine Veterans Bank; PNB Savings Bank; Rizal Commercial Banking Corp.; Security Bank Corp.; Standard Chartered Bank, Philippine branch, and United Coconut Planters Bank.
Makati RTC Judge Honorio E. Guano Jr. said in the order that the injunction was important to avoid rendering moot once they have ruled on the case.
The court said that it “violates the petitioners’ rights insofar as it imposes a manner of allocation of deductible expense which is, as argued by the petitioners, contrary to settled practice and provisions of the tax code; that such implementation will require petitioners to dispute the tax assessments every time it is issued.”