Tax Issues and Developments PEACe Bonds are now held taxable by the BIR The petitioners who

o bought such PEACe bonds from the government said that the BIR ruling which retroactively applies to government bonds sold in 2001, is prohibited under the 1997 Tax Code "for being extremely prejudicial to the bondholders, including petitioners who relied in good faith on the BIR declaration that the bonds are exempt from final tax." On the day of maturity of the PEACe bonds, the SC issued a temporary restraining order on the BIR's ruling imposing a 20 percent final withholding tax. The BIR said it upheld the 20 percent withholding tax of the PEACe bonds on the day of maturity and that the BoT had already collected the tax because it was not able to formally receive the TRO during the office hours of that day. The SC then ordered the BIR to explain why it should not be cited for contempt for its alleged failure to comply with an order stopping the taxing of the matured P35-billion PEACe bonds.

BIRs power to hold a taxpayer in contempt The BIR has been looking for income coming from Manny Pacquiaos endorsements in the Philippines and not on U.S. earned income since the Philippines respects RP-US tax treaty. Commissioner Henares said the BIR was actually being considerate with Pacquiao since her office only filed contempt charges. She said the BIR could actually file tax evasion if it wanted to. Henares urged Pacquiao to just present to the BIR the documents being asked from him. The provision on "failure to obey summons" provides penalties to persons who refuses "to appear, to testify, or to appear and produce books of accounts, records, memoranda or other papers, or to furnish information as required under the pertinent provisions of this Code."

Non-Filing of Income Tax Return used in the Impeachment Trial of Chief Justice Corona Chief Justice Renato Corona did not file his income tax returns (ITRs) from 2002 to 2010, Internal Revenue commissioner Kim Jacinto-Henares disclosed before the Senate, acting as an impeachment court, for the trial of Corona.