More ice water on Kim Henares

Spy Bits received a lot of emails from businessmen who don’t want to be identified (we hope it’s not out of fear) in reaction to our August 28 column “Business Groups on Kim: Pour more ice water, please!” Aside from the “ambiguities” in the revenue regulations, memo circulars and revenue memo circulars issued by the Bureau of Internal Revenue, a major complaint among business groups is the lack of proper information dissemination by way of public notices regarding new tax rules, not to mention the fact that the business groups were not given the opportunity to air their side concerning several controversial issues. “The days of dictators are over,” a businessman grumbled. 

Among the questioned issuances include RR 14-2012 and RMC 84-2012 that have to do with the creditable withholding tax (CWT) on interest incomes. RR 14-2012 provides that interest income derived from debt instruments not within the coverage of deposit substitutes shall be subject to 20 percent CWT. On the other hand RMC 84-2012 states that interest incomes received by banks from payors belonging to the Top 20,000 corporations strictly arising from individual loans obtained from banks that are not securitized, assigned or participated out are subject to 2 percent CWT.

Notably, the regulations do not intend to expand the coverage of income payments subject to 20 percent CWT made by those that do not belong to the top 20-K corporations and syndicated loans, explained a tax specialist. What is unclear according to some businessmen is whether clients that do not belong to the Top 20-K corporations are still required to withhold. As for the interest income on syndicated loans, they want to know if those clients belonging to the Top 20-K corporations are required to withhold 2 percent on the 20 percent tax.

Another confusing issue has to do with RMC 51-2014 which is supposed to clarify the “inurement prohibition” under Section 30 of the 1997 Revenue Code. The said circular outlines several instances where violations of the said prohibitions on inurement (an old term meaning benefit) that could make a nonprofit organization lose its tax exemptions.

According to critics, the RMC only served to raise more questions, not to mention resistance because among prohibited inurement are financial assistance to members of non-stock, non-profit organizations, and donations by charitable organizations to other persons or entities whose purpose are not similar to the ones making the donation. In short, charitable organizations and foundations whose purpose is to extend financial assistance will lose their tax exemptions if they grant scholarships for instance, some philanthropic entities argue. Clearly, such unclear (no pun intended) issuances are creating confusion and are making it even more difficult for people to comply.

Tama Poe vs. Mali Pabaya

Commuters are now even more outraged at DOTC Secretary Jun Abaya – who has earned the unflattering moniker of “Secretary Pabaya” – for taking the “MRT challenge” complete with media coverage and a retinue of personnel including an umbrella-wielding assistant, riding the coach meant for women, children, senior citizens and people with disabilities during the off-peak hour of 1:00 p.m.

Judging from the tweets, FB posts and comments, not to mention memes (one shows the tied-up DOTC secretary waiting for a train to run over him on a PNR rail), the “PR stunt” only managed to earn him unfavorable media mileage, with people saying he should have tried riding the MRT during the ungodly hour of 7:00 a.m. and from the North Avenue Station so that he will know what it’s like to stand under the sun (or the rain) for at least an hour before he could get a ride. One even told us, “How dare Pabaya do something that was obviously an insincere attempt to see the real conditions that commuters face, and tell us that he found the ride ‘pleasant’? Why is he still around when it’s clear that he is clueless?”

Netizen reactions to Abaya’s stunt was in stark contrast with the comments received by Senator Grace Poe when she quietly took the MRT without any fanfare, sans bodyguards or assistants, lining up at the North Avenue station for the better part of an hour before she was able to board a train at around 8:00 a.m. As one of our readers described it: “It’s a case of Tama Poe vs. Mali Pabaya.”

Comelec decision to reuse PCOS makes sense

The recommendation by the Comelec Advisory Council to reuse the precinct count optical scan (PCOS) machines makes a lot of sense because the use of this voting technology has already gained widespread acceptance among voters all over the country. People – including teachers and other voting precinct personnel – are already familiar with the PCOS, which would mean savings in terms of trainings and seminars on how to use an entirely new platform.

Besides, the Comelec already owns about 80,000 PCOS machines, and it would be such a waste to let them gather cobwebs in warehouses. The Comelec – the CAC specifically – must have realized that like an ATM terminal, the PCOS is designed and built to be used over and over again for many years – especially if they are properly stored and maintained.

Philex gets MGB nod to fully operate

MVP Group Media Bureau chief Mike Toledo informed us that the Mines and Geosciences Bureau (MGB) of the DENR has already given the green light for Philex Mining to resume full operations in its Padcal gold and copper mines in Benguet. 

In a two-page letter, the government regulator noted the company’s compliance with its environmental obligations such as the payment of the required fees, the immediate conduct of remediation measures and the submission of proof on the safety and integrity of the tailings dam that leaked due to unusually heavy sustained rainfall brought about by typhoons in August 2012. The formal requests from various groups for Philex to resume operations also factored in the MGB decision.

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