Only Court of Tax Appeals can halt BIR from collecting

CEBU, Philippines - The Bureau of Internal Revenue recently issued Revenue Memorandum Order No. 42-2010 pointing out that no court other than the Court of Tax Appeals has the authority to prohibit the BIR from collecting taxes imposed under the Tax Code.

The BIR in a statement said that this prohibition applies to issuance of temporary restraining order on all collection activities, service of warrants of distraint and garnishment, levy on final decisions of the BIR on disputed assessments, cases filed before the CTA and the sale of property distrained and garnished.

The BIR added that as specified in Section 218 of the Tax Code, injunctions are not available to restrain collection of taxes and no Court shall have the authority to grant an injunction to stop the collection of taxes.

However, pursuant to Section 11 of RA 1125 as amended, it is only the CTA that has the judicial jurisdiction to suspend the collection of taxes when in its opinion the collection by the BIR may jeopardize the interest of the government or the taxpayer.

It then requires taxpayer either to deposit the amount claimed or file a surety bond for not more than double the amount being assessed.

“Thus, any TRO issued by Courts other than CTA against the bureau contrary to the said provision should be annulled and cancelled. The BIR can then file an administrative case against erring judges who can be dismissed by the Supreme Court if circumstances so warrant,” the statement added.

It is also specified in the same law as amended by RA 9282, that no appeal taken to the CTA from the decision of the BIR on disputed assessment shall suspend the payment, levy, distraint or sale of any property of the taxpayer, unless the CTA suspends the collection under certain conditions.

Furthermore, the BIR may issue Notice of Tax Lien to safeguard the interest of the government as provided for in Section 219 of the Tax Code and other issuances of the BIR. — THE FREEMAN