What’s with the BIR these days?

SHOOTING STRAIGHT - Valeriano Avila - The Freeman

While the COVID-19 is still very much around, I dare say that Cebuanos seem to have learned from the last six months on ways how not to be infected by the coronavirus. This is why the Inter-Angency Task Force (IATF), which has handled our lockdown, has slowly tried to restart our businesses. Among them is our dramatic economic growth on tourism last year and today this has resulted in Cebu being granted the Best Island status by Conde Nast Magazine, besting even Boracay that used to hold this title.

So tonight we have with us again. Department of Tourism-7 Regional Director Shalimar Hofer Tamano. Last Saturday, we rode on a two-hour trip to Cordova, passing through Lapu-Lapu City which launched a Balik Turismo campaign and let me tell you that the people there have returned to their old ways, not even wearing face masks or face shields and, yes, traffic was snarled as it has always been.

So tonight on please watch Shalimar Tamano on our talk show SkyCable’s channel 53 at 8 p.m. with replays on Wednesday and Saturday same time and channel. We also have replays on MyTV’s channel 30 at 9 p.m. Monday and at 7 a.m. and 9 p.m. on Wednesday and Friday.

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We read the news report that the Bureau of Internal Revenue (BIR) is now granting tax exemptions on retirement benefits of private sector employees and the income and sickness benefits of health workers both public and private serving in the frontlines against COVID-19. Unfortunately, this is not the report I got from my business friends who told me that the BIR seems to be desperate in trying to milk money from them. Come on, we have been on a seven-month lockdown and businesses has shut down. The least we can expect are BIR officials trying to muscle in on businessmen whose establishments have had to shut down!

As mentioned in Phistar.com “Pursuant to the Bayanihan to Recover as One Act, Finance Secretary Carlos Dominguez III and Internal Revenue Commissioner Caesar Dulay issued Revenue Regulation No. 29-2020, which provides the guidelines to implement the grant of incentives on certain income payments of health workers. Under the new regulation, the COVID-19 Special Risk Allowance and Actual Hazard Duty Pay shall be excluded from gross income and therefore not subject to income tax.

“COVID-19 Special Risk Allowance is paid to private and public health workers directly in contact with COVID-19 patients, while the Actual Hazard Duty Pay is given to temporary Human Resources for Health serving in the frontlines. Also exempted from income tax are compensations paid to private and public health workers who have contracted COVID-19 in the line of duty amounting to P1 million in case of death; P100,000 in case of severe or critical illness; and P15,000 in case of mild or moderate sickness.

“This is provided that such amount is given from Feb. 1, 2020 and during the state of national health emergency as declared by the president; that the compensation is given not later than three months after date of confinement or death; and that supporting documents are submitted.

“For compensation in case of death, the said amount shall not be included as part of the gross estate of the decedent subject to estate tax,” the BIR said.

“Meanwhile, the BIR said retirement benefits received by officials and employees of private firms from June 5 to Dec. 31, 2020 are also not subject to the income tax, provided that the amount received is in accordance with a retirement plan duly registered with the agency.

“The BIR, however, emphasized that any re-employment of such official or employee in the same firm and its related parties within the succeeding 12-month period shall be considered as proof of non-retirement.

“As part of its transitory provisions, the BIR said taxes withheld from the retirement benefits by private employers should be refunded to the concerned employees.

“Concerned employers of the public or private health workers and HRHs shall likewise refund the income tax withheld from the said income payments after the year-end adjustment by the employer for purposes of determining the taxable compensation and the corresponding tax due of the employees,” the BIR said.”

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