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Alice Munro, Canadian Nobel Prize-winning author, 92

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OTTAWA — Nobel Prize-winning Canadian writer Alice Munro, whose exquisitely crafted tales of the loves, ambitions, and travails of small-town women in her native land made her a globally acclaimed master of the short story, has died at the age of 92, her publisher said on Tuesday.

Ms. Munro had died at her home in Port Hope, Ontario, said Kristin Cochrane, chief executive officer of McClelland & Stewart.

“Alice’s writing inspired countless writers … and her work leaves an indelible mark on our literary landscape,” she said in a statement.

The Globe and Mail newspaper, citing family members, said Ms. Munro had died on Monday after suffering from dementia for at least a decade.

Ms. Munro published more than a dozen collections of short stories and was honored with the Nobel Prize in Literature in 2013.

Her stories explored sex, yearning, discontent, aging, moral conflict, and other themes in rural settings with which she was intimately familiar — villages and farms in the Canadian province of Ontario. She was adept at fully developing complex characters within the limited pages of a short story.

“Alice Munro was a Canadian literary icon. For six decades, her short stories captivated hearts around Canada and the world,” Canadian Heritage Minister Pascale St-Onge said on the X social media network.

Ms. Munro, who wrote about ordinary people with clarity and realism, was often likened to Anton Chekhov, the 19th century Russian known for his brilliant short stories — a comparison the Swedish Academy cited in honoring her with the Nobel Prize.

Calling her a “master of the contemporary short story,” the Academy also said: “Her texts often feature depictions of everyday but decisive events, epiphanies of a kind, that illuminate the surrounding story and let existential questions appear in a flash of lightning.”

In an interview with the Canadian Broadcasting Corp. after winning the Nobel, Ms. Munro said, “I think my stories have gotten around quite remarkably for short stories, and I would really hope that this would make people see the short story as an important art, not just something that you played around with until you’d got a novel written.”

Her works included: Dance of the Happy Shades (1968), Lives of Girls and Women (1971), Who Do You Think You Are? (1978), The Moons of Jupiter (1982), Hateship, Friendship, Courtship, Loveship, Marriage (2001), Runaway (2004), The View from Castle Rock (2006), Too Much Happiness (2009), and Dear Life (2012).

The characters in her stories were often girls and women who lead seemingly unexceptional lives but struggle with tribulations ranging from sexual abuse and stifling marriages to repressed love and the ravages of aging.

“Last month I reread all of Alice Munro’s books. I felt the need to be close to her. Every time I read her is a new experience. Every time changes me. She will live forever,” leading Canadian author Heather O’Neill said in a post on X.

Ms. Munro’s story of a woman who starts losing her memory and agrees to enter a nursing home titled “The Bear Came Over the Mountain,” from Hateship, Friendship, Courtship, Loveship, Marriage, was adapted into the Oscar-nominated 2006 film Away From Her, directed by fellow Canadian Sarah Polley.

‘SHAME AND EMBARRASSMENT’
Canadian novelist Margaret Atwood, writing in the Guardian after Ms. Munro won the Nobel, summarized her work by saying: “Shame and embarrassment are driving forces for Munro’s characters, just as perfectionism in the writing has been a driving force for her: getting it down, getting it right, but also the impossibility of that. Munro chronicles failure much more often than she chronicles success, because the task of the writer has failure built in.”

American novelist Jonathan Franzen wrote in 2005, “Reading Munro puts me in that state of quiet reflection in which I think about my own life: about the decisions I’ve made, the things I’ve done and haven’t done, the kind of person I am, the prospect of death.”

The short story, a style more popular in the 19th and early 20th century, has long taken a back seat to the novel in popular tastes — and in attracting awards. But Ms. Munro was able to infuse her short stories with a richness of plot and depth of detail usually more characteristic of full-length novels.

“For years and years, I thought that stories were just practice, ’til I got time to write a novel. Then I found that they were all I could do and so I faced that. I suppose that my trying to get so much into stories has been a compensation,” Ms. Munro told the New Yorker magazine in 2012.

She was the second Canadian-born writer to win the Nobel literature prize but the first with a distinctly Canadian identity. Saul Bellow, who won in 1976, was born in Quebec but raised in Chicago and was widely seen as an American writer.

Ms. Munro also won the Man Booker International Prize in 2009 and the Giller Prize — Canada’s most high-profile literary award — twice.

Alice Laidlaw was born to a hard-pressed family of farmers on July 10, 1931, in Wingham, a small town in the region of southwestern Ontario that serves as the setting for many of her stories, and started writing in her teens.

Ms. Munro originally began writing short stories while a stay-at-home mother. She intended to someday write a novel, but said that with three children she was never able to find the time necessary. Ms. Munro began building a reputation when her stories started getting published in the New Yorker in the 1970s.

She married James Munro in 1951 and moved to Victoria, British Columbia, where the two ran a bookstore. They had four daughters — one died just hours after being born — before divorcing in 1972. Afterward, Ms. Munro moved back to Ontario. Her second husband, geographer Gerald Fremlin, died in April 2013.

Ms. Munro in 2009 revealed she had undergone heart bypass surgery and had been treated for cancer. — Reuters

Overseas Filipinos’ Cash Remittances

MONEY SENT HOME by overseas Filipino workers (OFWs) in March recorded its slowest pace of growth in nine months, data from the Bangko Sentral ng Pilipinas (BSP) showed. Read the full story.

 

Overseas Filipinos’ Cash Remittances

How PSEi member stocks performed — May 15, 2024

Here’s a quick glance at how PSEi stocks fared on Wednesday, May 15, 2024.


PHL gross gaming revenue up 18.5% in first quarter — PAGCOR

PHILIPPINE STAR/KRIZ JOHN ROSALES

THE Philippines’ gross gaming revenue (GGR) rose 18.5% year on year to a record P81.7 billion in the first quarter, the Philippine Amusement and Gaming Corp. (PAGCOR) said.

In a statement on Wednesday, the gaming regulator said the first quarter total was nearly on pace to hit the full-year GGR target of P336 billion.

“The latest GGR is another new record, sustaining an upward trend for the gaming industry since the post-pandemic recovery started in the last quarter of 2022,” it said.

PAGCOR said that the bulk of first-quarter revenue was generated by licensed casinos, which raised P49.7 billion, though this was 8.2% lower year on year.

Meanwhile, e-games revenue surged 543% to P22.5 billion.

“The e-games revenue performance continues to exceed our projections, and this reflects how gaming technology and the proliferation of mobile devices is influencing not only our daily lives but our entertainment choices as well,” PAGCOR Chairman and Chief Executive Officer Alejandro H. Tengco said.

Revenue from PAGCOR-operated casinos under its Casino Filipino brand dropped 8.6% to P4.69 billion.

PAGCOR said this was due to the “challenge faced by the segment as more players continue to migrate to online platforms.”

Meanwhile, bingo revenue fell 21.5% to P4.81 billion. — Luisa Maria Jacinta C. Jocson

Laguindingan attracts 2 possible challengers

PHILSTAR FILE PHOTO

AT LEAST two parties have expressed interest in the upgrade and operations contract for Laguindingan International Airport in northern Mindanao, the Department of Transportation (DoTr) said. 

“There are two challengers, they have not submitted a counter proposal yet, but they have expressed interest,” Roberto C.O. Lim, Transportation undersecretary for aviation and airports, told reporters on Wednesday.

Mr. Lim made the announcement during the 2024 Aviation Summit organized by the European Chamber of Commerce of the Philippines.

The two parties have paid the participation fees but have not yet submitted their counter proposal, he said.

In February, the DoTr announced that companies were open to challenge the P12.75-billion proposal of Aboitiz InfraCapital, Inc. to operate, maintain, and expand Laguindingan.

“The Swiss challenge has started. We published yesterday the bid, the instruction to bidders that will identify the technical, financial eligibility,” Mr. Lim said.

The Swiss challenge process allows original proponents (OPs) to undertake a project unsolicited, opening up their bid to a challenge by other parties, which the OP then has a right to match.

The DoTr said if no parties end up formally challenging Aboitiz InfraCapital, the contract can be awarded to the OP within 90 days.

According to the guidelines to challengers published by the DoTr, a qualified challenger must have a net worth of at least P3.8 billion or its foreign currency equivalent.

“In case of a consortium, the net worth of consortium members who have an equity share of at least 25% each in the consortium may be added together,” the DoTr said.

The challenger must also have expertise in the operation and maintenance of an international airport, being involved in the industry for at least three consecutive years. The capacity of the airport it was previously involved in must be at least five million passengers yearly.

Aside from Laguindingan, the infrastructure arm of the Aboitiz group has also submitted unsolicited proposals for Bohol-Panglao International Airport and Bicol International Airport.

In 2022, Aboitiz InfraCapital finalized a deal with Megawide Construction Corp. and GMR Airports International, B.V., allowing it to acquire shares in GMR-Megawide Cebu Airport Corp., the company behind the Mactan-Cebu International Airport. — Ashley Erika O. Jose

ERC lets reserve market players settle 30% of March transactions

BW FILE PHOTO

THE Energy Regulatory Commission (ERC) ordered the partial lifting of the suspension imposed in March to enable the flow of reserve power into the system.

In an order promulgated on May 9, the ERC allowed the settlement of 30% of the amounts due on the reserve market transactions during the March billing month.

“The decision was made in an effort to ensure continuous operations of power generators providing reserves in the system following the suspension order issued on March 25, 2024,” the ERC said.

Citing simulations, the regulator projected the partial payments are expected to be worth P1.7 billion.

The amount is subject to adjustments pending the submission of the list of non-compliant generators by the National Grid Corp. of the Philippines (NGCP), an intervenor in the case.

The reserves traded for the March period were valued at P5.7 billion, the ERC said.

Arjon Valencia, corporate planning and communications manager of the Independent Electricity Market Operator of the Philippines (IEMOP), said IEMOP “will implement the order accordingly and will continue its close coordination with the ERC and the DoE (Department of Energy) for the immediate resumption of reserve market commercial operations,” he said via Viber message.

ERC Chairperson and Chief Executive Officer Monalisa C. Dimalanta said the commission hopes to complete its evaluation within the month before fully lifting the suspension.

The ERC is “waiting for IEMOP and NGCP to complete the submission of required documents,” she said in a Viber message.

She said that the partial lifting of the suspension could possibly lead to upward adjustments in transmission charges.

“Total rates will still depend on the generation mix,” she said.

The reserve market allows the optimization of the market operator and system operator interfaces and automated real-time dispatch of committed ancillary services.

Ancillary services are deployed by grid operators to support the transmission of power from generators to consumers to maintain reliable operations.

The full commercial operations of the reserve market commenced in January.

In the suspension order in March, the ERC said that the IEMOP reported “significant price increases” in reserve costs for March compared to February. The regulator has said that the increase will impact the total price of electricity paid for by the public.

YELLOW ALERT
In an advisory on Wednesday afternoon, the NGCP raised yellow alerts over the Visayas grid between 2 p.m. and 4 p.m. and 6 p.m. and 8 p.m.

The available capacity was 2,968 megawatts (MW) while peak demand was 2,646 MW.

The grid operator said that the yellow alerts were lifted with the availability of power from the Cebu Energy Development Corp. unit 1 and Panay Diesel 1-3. 

A yellow alert is issued when the operating margin is insufficient to meet the transmission grid’s contingency requirement. — Sheldeen Joy Talavera

Mall tenants ordered to explain privacy issues

THE National Privacy Commission (NPC) said on Wednesday that a field inspection resulted in the issuance of show-cause orders to 65 establishments in a mall in Paranaque City.

NPC Circular No. 2024-01 authorizes on-the-spot inspections to verify whether personal information controllers (PICs) or personal information processors (PIPs) comply with the Data Privacy Act of 2012 (DPA) and the regulator’s other issuances.

“Malls and retail stores collect significant amounts of personal data from customers daily. Hence, these entities must comply with the DPA and NPC issuances to protect the rights of their data subjects and maintain consumer trust,” according to Privacy Commissioner John Henry Naga.

Mr. Naga said that fines ranging from P20,000 to P5 million can be imposed on violators of the DPA and other NPC issuances.

“This on-the-spot privacy sweep and compliance check should also serve as a warning to all non-compliant and erring PICs and PIPs that the NPC will not hesitate to impose administrative fines for violations of the DPA, its implementing rules and regulations, and the issuances of the NPC,” he said.

According to the NPC, 56 establishments were found to have not registered with the NPC, while nine establishments, while being registered, were issued citation tickets for other violations.

Some 38 establishments were found to have been compliant, registered, with their seal of registration properly displayed.

“Our primary goal is to ensure that PICs and PIPs are fully aware of their responsibilities under the DPA,” NPC Data Security and Compliance Office Director Aubin Arn Nieva said.

“If we find areas of non-compliance or potential vulnerabilities in their data handling practices, we can offer personalized recommendations and support to help them address these gaps and improve their data protection measures,” he added.

After the compliance check, the NPC will present its findings and assess whether the PICs or PIPs have any deficiencies, during which they will be requested to submit the necessary documents

The NPC is planning to replicate the on-the-spot privacy sweep at other malls and has clarified that it is the establishment or the lessee that will be held liable for the violations, not the mall owners or lessors. — Justine Irish D. Tabile

GMO crops pushed to counter climate disasters

RENZO D SOUZA—UNSPLASH

By Adrian H. Halili, Reporter

THE PHILIPPINES should consider cultivating crops classified as genetically modified organisms (GMOs) to mitigate the impact of climate disasters like typhoons and El Niño.

“When you look at the scale of damage that’s been caused, then I think it’s important for the sector to look at ways in which they can combat that,” Rory O’Donnell, an agriculture and trade expert for business solutions firm Penta, told BusinessWorld.

He added that GMO crops are already being planted in parts of Europe to alleviate drought conditions.

President Ferdinand R. Marcos, Jr. has ordered the Solicitor General to seek clarification and reconsideration of the decision to ban on the use of GMOs.

Mr. Marcos said that the decision would have a “widespread” impact on agriculture and food security.

“It basically is a means of accelerating natural genetic changes in crops,” Mr. O’Donnell said.

“The idea behind that is to develop crops that are drought resistant or more resistant to pests and therefore reduce the requirement for pesticides and other artificial additions,” he added.

The Court of Appeals (CA) revoked the biosafety permits for the commercial propagation of Golden Rice and Bt Eggplant, citing the potential risk to the environment and the health of consumers.

It also stopped field testing and imports until all measures were taken to ensure they were safe.

In a Senate hearing on Tuesday, the Department of Agriculture said it is also seeking reconsideration of the CA’s decision.

“There is a general communications problem around GMOs and new genomic techniques, where it’s very easy for people who are against them to say that there is a theoretical risk that is hard to assess and therefore, we shouldn’t do anything,” Mr. O’Donnell said.

He added that the agriculture industry continues to face the impact of climate change worldwide.

“The degree of climate change and the implications that’s having across the world for agriculture — I think we have to start looking at all the tools that are available. That’s not to say you don’t have to have rigorous scientific processes in place to ensure they’re safe,” Mr. O’Donnell said.

Damage and loss caused by El Niño have hit P6.35 billion as of May 8, with rice and corn the most affected crops. The total affected area was 111,702 hectares, impacting 121,389 farmers and fisherfolk.

Additionally, the DA said that it is currently preparing for above normal rainfall brought about by La Niña in the second half of the year.

PAGASA (Philippine Atmospheric, Geophysical and Astronomical Services Administration), the government weather service, said there is a 62% chance of La Niña setting in between June and August.

Cerberus sees Hyundai unit starting at Subic yard within 18 months

HHCI PHILIPPINES

US INVESTMENT firm Cerberus Capital Management said it expects a South Korean shipbuilder which leased a portion of its shipyard in Subic to begin operations in 12-18 months.

Cerberus unit Agila Subic shipyard signed a multi-year lease agreement with Hyundai Group unit HD Korea Shipbuilding and Offshore Engineering, which plans to manufacture maritime products at the 350-hectare facility targeted at the offshore wind industry.

The return of shipbuilding to the Subic area will involve tens to hundreds of millions of dollars in investment and generate thousands of jobs, Cerberus Senior Managing Director Alexander Benard said in an online briefing.

“HD Hyundai KSOE will be leasing a large section of the shipyard from us and will be bringing maritime manufacturing back to Subic at a very large scale with an initial focus on offshore wind platforms,” Mr. Benard said.

“This will create very substantial employment and will really bring that economic activity and vitality back to the Subic Bay region … but of course it will take some time to ramp up (operations),” he added.

The agreement with HD Hyundai KSOE, which was formally announced at Malacañang Palace on Tuesday, was signed through Cerberus affiliate Agila South, Inc.

“When we acquired the Hanjin facility two years ago, we set out to revitalize the shipyard, repurpose the site into a multi-use facility, and bring thousands of jobs to the Subic Bay region,” Mr. Benard said, referring to the previous occupant, which went into administration after defaulting on $1.3 billion in debt.

“We’re pleased to take the next step in delivering on that vision by partnering with a premier global shipbuilding and offshore engineering company to make a substantial commitment to the future of Subic Bay and its surrounding communities,” he added.

HD Hyundai KSOE will be building a facility capable of handling offshore wind structures, ship block fabrication, ship repair, and other services. It will operate in the yard’s largest dry dock.

Kim Sungjoon, chief executive officer of HD Hyundai KSOE, said that the “initiative represents a major opportunity to create jobs and reinvigorate the local economy, which will help to further establish the Philippines as a global maritime powerhouse.”

Cerberus now has four major tenants in the Subic Bay facility. The other tenants are global subsea cable company Subcom, logistics company V2X, and the Philippine Navy.

The entire facility can host 20,000 workers, according to Mr. Benard, which was also the same staffing level under Hanjin Heavy Industries and Construction Philippines, Inc.

Cerberus acquired the yard in April 2022 and rebranded it Agila Subic.

“What that means is that for three years, the facility was effectively mothballed; it was not operating, and when you have a facility that is not working for three years, things start to fall into a bit of a state of disrepair,” Mr. Benard said.

“So when we stepped in and took over the asset in April of 2022, we had to begin a process of revitalizing this asset and putting it back into operational condition,” he added.

However, instead of implementing the same business plan as Hanjin, which used the facility as one a shipbuilding factory, Cerberus took a multi-use approach, leasing to various industrial and manufacturing tenants.

Mr. Benard said Cerberus is in talks with other ship repair and maintenance business to fill the remaining space in the yard.

“That is part of the plan, and that is really, I guess, the final piece that we anticipate finalizing later this year as well,” Mr. Benard said.

“We are in active discussions with a few parties, and we believe that before the end of this year we will have signed a lease agreement with a commercial company… to establish a ship repair and maintenance business,” he added.

Meanwhile, Mr. Benard said that Cerberus is also looking at other assets and opportunities in the Philippines.

“The broad categories that are of interest to us are in areas like semiconductor manufacturing and assembly and other types of logistics assets, as we believe logistics and transportation are important areas for the country,” he said.

“Those are really the types of things that we are looking at, and we are hoping to find some specific opportunities in the next year or two,” he added. — Justine Irish D. Tabile

Qatar, PHL commit to approve IPPA this year

REUTERS

QATAR and the Philippines have agreed to approve an Investment Promotion and Protection Agreement (IPPA) within the year, the Department of Trade and Industry (DTI) said.

“The entry into force of the IPPA is expected to significantly deepen the economic ties between the Philippines and Qatar,” Trade Secretary Alfredo E. Pascual said in a statement on Wednesday. 

The parties to the IPPA negotiations are the DTI and Qatar’s Minister of Commerce and Industry.

“We are confident that finalizing the ratification process will translate into productive investment figures contributing to our mutually shared prosperity,” Mr. Pascual added.

According to the DTI, the Philippines has completed the domestic procedures for moving forward with the agreement, while Qatar is finalizing the Arabic version of the IPPA, which it needs for their own ratification process.

The IPPA was signed in 2017 during the visit of former President Rodrigo R. Duterte to Qatar.

Mr. Pascual discussed the ratification process with Qatar Minister of Commerce and Industry Sheikh Mohammed Bin Hamad Bin Qassim Al-Abdullah Al-Thani on the sidelines of this week’s Qatar Economic Forum.

Aside from agreeing to ratify the IPPA within the year, the two sides also agreed to pursue a memorandum of understanding (MoU) to cooperate on intellectual property rights protection.

Under the partnership, both countries will exchange information, best practices, and training programs and conduct high-level dialogues on intellectual property policy to help address concerns about the proliferation of fake Philippine brands in the Middle East.

“The Philippine delegation expressed concern about the proliferation of counterfeits in the Middle East, including Qatar,” the department said.

“They said enhanced cooperation on intellectual property rights protection, including the proposed MoU, would address these concerns and create a more fair and secure environment,” it added.

The two sides also agreed to organize a business forum and a business-to-business matching session on the sidelines of the Philippines-Qatar Joint Economic, Commercial, and Technical Committee, which is expected to take place in the first quarter of 2025.

“We are pleased with the progress made in this meeting, and we are positive that the finalization of the IPPA ratification process will soon pave the way for its full implementation,” Mr. Pascual said. — Justine Irish D. Tabile

Peso strengthens ahead of BSP review

BW FILE PHOTO

THE PESO appreciated against the dollar on Wednesday before the Bangko Sentral ng Pilipinas’ (BSP) policy review on Thursday.

The local unit closed at P57.505 per dollar on Wednesday, surging by 33.5 centavos from its P57.84 finish on Tuesday, Bankers Association of the Philippines data showed.

The peso opened Wednesday’s session stronger at P57.71 against the dollar. Its weakest showing was at P57.74 versus the greenback, while it closed at its intraday best.

Dollars exchanged rose to $1.27 billion on Wednesday from $1.14 billion on Tuesday.

“The peso appreciated amid potentially hawkish remarks from the BSP policy meeting,” a trader said in an e-mail.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message that the Monetary Board is likely to mirror the US Federal Reserve’s decision to keep rates steady at its own meeting earlier this month.

The BSP is widely expected to keep its policy rate at a 17-year high of 6.5% for a fifth straight meeting on Thursday, according to 17 out of 19 analysts in a BusinessWorld poll.

The central bank raised borrowing costs by a cumulative 450 basis points from May 2022 to October 2023.

BSP Governor Eli M. Remolona, Jr. previously said the Monetary Board could cut rates as early as the third quarter if inflation settles within target and if economic growth is weaker than expected. Otherwise, it could begin easing as late as the first quarter of 2025.

Meanwhile, the US central bank this month kept its target rate at the 5.25%-5.5% range for a sixth straight review.

For Thursday, the trader said the peso will move depending on the US consumer inflation report to be released overnight.

The trader sees the peso moving between P57.35 and P57.60 a dollar, while Mr. Ricafort expects it to range from P57.40 to P57.60. — A.M.C. Sy

EoPT on tax filing and withholding: A closer look

With the signing of the Ease of Paying Taxes (EoPT) Act (Republic Act No. 11976), taxpayers expect to benefit from improvements in the manner of tax filing and payment, as well as in the withholding of taxes. The Bureau of Internal Revenue (BIR) has issued Revenue Regulations (RR) No. 4-2024 to implement these changes.

MANNER OF FILING AND PAYMENT
Under RR 4-2024, the filing of tax returns is to be done electronically via any of the available platforms. Taxpayers have the option to use either the eBIRForm offline package or the Electronic Filing and Payment System (eFPS). Meanwhile, the payment may be made either electronically using any of the available platforms, or manually to any authorized agent bank (AAB) or revenue collection officer (RCO). Manual filing is only allowed in case of the unavailability of electronic platforms.

Prior to the EoPT Act, certain taxpayers were required to enroll in eFPS, such as Taxpayer Account Management Program (TAMP) taxpayers, enterprises enjoying fiscal incentives (PEZA, BoI, etc.), large taxpayers, and top withholding agents, among others. While there’s no specific discussion in the EoPT Act, I believe that these taxpayers should continue to use eFPS in the filing and payment of their tax returns as manual filing will only be allowed in case the eFPS facility is unavailable. Further, it is still more convenient to file and pay taxes through eFPS.

On the option to manually file tax returns, the BIR has yet to clarify how this will be implemented, as the usual worry of taxpayers is the downtime of electronic platforms during the tax filing deadlines. While the option to file manually is available, it may not be possible to prepare the check payment or release the funds on the same day of the filing. Hence, there is still a chance that the actual payment of taxes will occur beyond the deadline.

It is also a relief to taxpayers that the civil penalty of 25% of the amount payable (i.e., surcharge) no longer applies if the return is submitted to an internal revenue office other than the one with whom the taxpayer is registered and where the return is required to file.

INDIVIDUALS NOT REQUIRED TO FILE RETURNS
Under the RR, Philippine citizens who are working and deriving income solely from abroad as an Overseas Contract Worker or Overseas Filipino Worker (OFW) are no longer required to file income tax returns. This is in addition to the following individuals who, even under the old rules, were not required to file: (1) individuals earning purely compensation income whose annual taxable income does not exceed P250,000; (2) individuals whose income tax has been correctly withheld by their employer; (3) individuals whose sole income has been subjected to final withholding tax; and (4) minimum wage earners. It is worth noting that the income tax exemption of OFWs on earnings abroad was available in the Tax Code even before the EoPT Law. Thus, this new implementing provision is just updating the list of individuals not required to file income tax returns and reiterating the exemption of OFWs.

RULES ON WITHHOLDING OF TAX
The EoPT Law also streamlined the timing of withholding taxes. Under the new law, the obligation of the payor to deduct and withhold taxes arises at the time an income has become payable.

In implementing this provision, RR 4-2024 adopted the old withholding tax rules when it defined the term “payable” as the date the obligation becomes due, demandable or legally enforceable. The RR likewise retained the accrual trigger for withholding taxes by stating that the obligation of the payor to deduct and withhold the tax arises at the time an income payment is accrued or recorded as an expense or asset, whichever is applicable, in the payor’s books, or at the issuance by the seller of the sales invoice or other adequate document to support such payable, whichever comes first.

In contrast to the pre-EoPT rule on the timing of withholding of taxes, the point of withholding upon payment was removed. Further, the issuance of the sales invoice or other adequate document to support the payable was added as a trigger point for the obligation to withhold.

To reiterate, the EoPT Law provides that the timing of withholding of tax is when the income becomes payable. There is no qualification that the withholding tax falls due when it is payable or accrued, whichever comes first. While the terms “payable” and “accrual” are closely related and expenses are generally accrued when they become payable, they are distinct terms. In fact, the issue on timing of withholding upon accrual was raised during the Senate public hearings and technical working group discussions, and was precisely the trigger point that most stakeholders wanted to eliminate. Hence, to address the concern, the law provided “payable” for clarity.

I hope that the BIR will issue a clarification on this as one of the objectives of the EoPT Law is to simplify the process of withholding taxes. Essentially, with the “new” trigger points for withholding tax under the RR, there’s not much change in the process as taxpayers are still required to withhold taxes upon accrual of the expenses in the books.

Another welcome change under the EoPT Law is the repeal of Section 34(K) of the Tax Code. Thus, a particular expense on which tax is required to be withheld can now be claimed as deduction from gross income, even if no tax was withheld. Of course, the expense must still meet the other requirements for deductibility, i.e., it must be a necessary, ordinary and duly substantiated expense related to the registered business of the taxpayer. It should be noted that only the requisite for deductibility was repealed, hence the obligation to withhold and remit tax on certain income payments remains.

The BIR also issued Revenue Memorandum Circular (RMC) No. 60-2024 to clarify that the waiving of the withholding tax requirements for expense deductions applies only for taxable year covering Jan. 1, 2024 onwards. Hence, old rules still apply to all assessed tax cases and on-going audits covering taxable periods prior to the effectivity of the EoPT Law.

With the changes brought by the EoPT Law, taxpayers are expected to adopt new, easier processes in the filing and payment of taxes. The BIR should be given credit for issuing the implementing rules and regulations (IRR) of the EoPT Law on time, but I am also hoping that it clarifies certain provisions in the IRR which seem inconsistent with the objectives of the law (i.e., timing of withholding of taxes).

The views or opinions expressed in this article are solely those of the author and do not necessarily represent those of Isla Lipana & Co. The content is for general information purposes only, and should not be used as a substitute for specific advice.

 

Renz Anthony K. Boaloy is a senior manager at the Client Accounting Services group of Isla Lipana & Co., the Philippine member firm of the PricewaterhouseCoopers global network.

renz.anthony.k.boaloy@pwc.com