PPP governing board to set fees for disqualified proponents filing appeals

September 13, 2023 | 8:52 pm

THE Public-Private Partnership (PPP) Governing Board said it is working on guidelines governing appeals filed by prospective proponents who were eliminated at a project’s pre-qualification stages.

According to a notice posted to the website of the PPP Center, the guidelines will “set a fair and appropriate amount of appeal fees for disqualified proponents which shall not discourage potential appellants from challenging the disqualification decision.”

The guidelines are also designed to “dissuade non-serious bidders (from) filing appeals which can impede the procurement process for PPP projects.”

“Proponents who fail to pre-qualify may appeal their disqualification, subject to the rules and prerequisites outlined in implementing rules and regulations (IRR) of the Build-Operate-Transfer Law. One of these conditions is the payment of a non-refundable appeal fee,” it said.

Appeal fees are set at no less than 0.5% of the project cost, according to Section 5.5 of the revised IRR.

“However, during the amendment process of the 2022 IRR, particularly in the inter-agency discussions, some agencies raised concerns about the lack of flexibility of the provision on appeal fees,” it said.

“The revised 2022 IRR removes this lack by not setting the appeal fee at a specific percentage and instead providing that it shall be in an amount approved by the Approving Body pursuant to guidelines to be issued by the PPP Governing Board,” it added.

According to a draft resolution, the appeal fee will vary from 0.75% of the project cost for projects costing P2 billion or less, to 0.10% of the project cost for projects costing more than P200 billion.

The PPP Governing Board is chaired by the National Economic and Development Authority Secretary, with the Finance Secretary acting as vice-chair. Its members include the secretaries of the Departments of Budget and Management, Justice, Trade and Industry, the Executive Secretary, and Private Sector Co-Chairman of the National Competitiveness Council.

The PPP Center acts as the secretariat for the board.

Comment on the guidelines is being solicited as part of the consultation process. The deadline to comment is Sept. 27. — Luisa Maria Jacinta C. Jocson

Estate tax amnesty: A refresher

September 13, 2023 | 8:52 pm

Estate settlement entails huge tax payments. Prior to the TRAIN Law, the estate tax due was the aggregate of a specific base tax plus an additional 5% to 20% of the amount in excess of a base net estate threshold.

For many Filipinos, this graduated estate tax rate proved a bit steep. Coupled with the lack of information on how to go about settling an estate, and at times, lack of agreement on how to distribute the estate, this resulted in heirs, transferees, and/or beneficiaries opting to leave the estate unsettled. Others, with the expectation of the inconvenience that they could face when they settle their kin’s estate, resort to simulating a sale transaction just to avail of the 6% capital gains tax applicable to sale of real property.

With the passage of the TRAIN Law, the graduated estate tax rates were scrapped and the tax rate was set at a uniform 6%. With the rate reduction, it made more sense to settle the estate than to simulate a sale given that the estate may benefit from the deductions allowed under the law. However, while prospectively, estates would benefit from the reduced rate, unsettled estates are left in no better condition as they face penalties and interest should they decide to undergo the settlement process.

To encourage the processing of unsettled estates, Republic Act (RA) No. 11213, or the Tax Amnesty Act of 2018, was signed on Feb. 14, 2019. This gave estates of decedents who died on or before Dec. 31, 2017, with or without assessments, whose estate taxes remained unpaid or have accrued as of Dec. 31, 2017, the opportunity to settle their tax obligations without having to pay the penalties that had accumulated due to the failure to pay the estate tax on time. Aside from dispensing with the penalties and interest, the amnesty also imposed the 6% estate tax under the TRAIN Law at every stage of transfer of the property.

Notwithstanding the reduction in the estate tax rate and the waiver of the corresponding penalties and interest for failure to settle the estate on time, the Tax Amnesty Act of 2018 imposed certain conditions. For instance, the deductions remain those applicable at the time of the death of the decedent. Meanwhile, if the deductions exceed the value of the gross estate, there is a minimum estate amnesty tax for the transfer of the estate of each decedent in the amount of P5,000. In addition, in case there are properties included in the Estate Tax Amnesty availment which are the subject of a taxable donation/sale, they shall be assessed donor’s tax/capital gains tax/other applicable taxes at the time of the donation/sale, plus penalties, if applicable.

The period to avail of the benefits of the Estate Tax Amnesty Program under RA 11213 was only until June 14, 2021, which is two years from June 15, 2019, the effectivity of the Revenue Regulations No. 6-2019, the Implementing Rules and Regulations (IRR) of RA No. 11213.

Before the expiration, however, the amnesty program was further extended until June 14, 2023 under RA No. 11569. This year, pursuant to RA No. 11956 which lapsed into law on Aug. 5, 2023, the period to avail of the program was further extended for another two years, i.e., until June 14, 2025.

Aside from the extension, RA No. 11956 expanded the coverage of the amnesty program to include estates of decedents who died on or before May 31, 2022, with or without assessment, but whose estate taxes have remained unpaid or have accrued as of May 31, 2022. It also listed in detail the documents that must be submitted to the Bureau of Internal Revenue (BIR) to avail of the estate tax amnesty and allowed payment by installment within two years from the statutory date of its payment without civil penalty and interest.

HOW TO AVAIL
Under the law and the IRR of RA No. 11956 (RR No. 10-2023), within the two-year extended window (i.e., June 15, 2023 to June 14, 2025), the executors, administrators, legal heirs, transferees or beneficiaries must file and pay either electronically or manually, with any authorized agent bank (AAB), Revenue District Office (RDO) through the Revenue Collection Officer (RCO), or authorized tax software provider, a sworn Estate Tax Amnesty Return. The return together with the Acceptance Payment Form (APF) and the complete documents shall be presented to the concerned RDO.

RR No. 10-2013 lists the documents that must be submitted. Nevertheless, in the absence of the required documents, the Commissioner may request alternative documents as may be deemed appropriate.

Within five working days from receipt of complete documents, the concerned RDO will endorse the APF for payment of the estate amnesty tax with AABs, RCOs, or authorized tax software provider, or shall notify the taxpayer in case there is any deficiency in the application. Only duly endorsed APFs shall be presented to and received by the AAB, RCO or authorized tax software provider.

After payment, the duly accomplished and sworn Return and APF with proof of payment and complete documents, must be submitted to the concerned RDO in triplicate.

Proof of settlement of the estate, whether judicial or extrajudicial, need not accompany the return if it is not yet available at the time of filing and payment of taxes, but no electronic Certificate Authorizing Registration (eCAR) may be issued unless such proof is presented and submitted to the concerned RDO. The eCAR, which serves as confirmation that the requisite tax has been paid, is indispensable to transfer ownership of real and personal property.

As emphasized by Congress, the pandemic posed challenges that likely affected the opportunity to avail of the amnesty program. This necessitated the passage of another extension. Still, the pandemic aside, the extension is a welcome measure to help alleviate the financial burden that has been a showstopper for most estate settlements.

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.

Kathleen C. Galano is an assistant manager at the Tax Services department of Isla Lipana & Co., the Philippine member firm of the PwC network.

63 (2)8845-2728

kathleen.c.galano@pwc.com

Defense chief says civilian agencies’ intel funds aid in countering threats

September 13, 2023 | 8:29 pm

Gilberto-Gibo-Teodoro — DEFENSE SECRETARY GILBERTO ‘GIBO’ C. TEODORO, JR. — SENATE PRIB

By Beatriz Marie D. Cruz, Reporter

PHILIPPINE DEFENSE Secretary Gilberto “Gibo” C. Teodoro, Jr. has justified the need for civilian agencies of government to have their own confidential and intelligence funds (CIF), noting that there could be internal activities conducted to aid the country’s external threats.

“There could be a fusion of external threats through internal activities that are disbursed and we are still validating,” Mr. Teodoro said when he faced the powerful Commission on Appointments (CA) for the confirmation of his interim appointment to the top post of the Department of National Defense (DND).

“[To] take control of your internal economy and internal process and the like, you would need intelligence and confidential funds to monitor and suppress this,” he said further of the need to equip certain government agencies.

Senator Ana Theresia “Risa” N. Hontiveros-Baraquel noted that several civilian and intelligence agencies with anti-crime mandates as well as departments required to work against external threats, will need CIFs.

“I just have the feeling that right now [allocations for CIFs are] too disbursed,” she told the panel.

Lawmakers previously noted the surge in agencies asking for CIFs in next year’s budget.

“What we are doing now in Congress, even in budget debates, is that civilian agencies that will [have] confidential funds are those really mandated to use these funds for national defense, internal security, public safety, and of course intelligence mandates,” Ms. Hontiveros-Baraquel said.

The budget for confidential and intelligence funds next year increased by P120 million to P10.14 billion — P5.28 billion in intelligence and P4.86 billion in confidential funds.

Under the 2024 National Expenditure Program, the Office of the President was given P4.5 billion in intelligence funds, while the Office of the Vice President and the Department Education (DepEd) sought confidential funds worth P500 million and P150 million, respectively.

The budgets of these three offices breezed through the House Committee on Appropriations without scrutiny, especially on its proposed CIFs.

The Department of Information and Communications Technology (DICT) got confidential funds worth P300 million. The Bureau of Customs will get P30.5 million, while the Department of Foreign Affairs was allotted P5 million in confidential funds.

The Department of Agriculture was allotted P50 million in confidential funds, the DND, P60 million, and the Presidential Security Group, P60 million.

Mr. Teodoro noted that there are no national security issues on Chinese state-owned enterprises and cell towers operating in the Philippines’ power sector and military bases, respectively.

“That’s not so much a problem because we can monitor it and we have default control over it,” he assured the CA panel.

However, Mr. Teodoro submitted that they cannot monitor the entry of workers assigned to infrastructure projects in the country.

He acknowledged that there is a necessity to tighten surveillance of “covert economic activities and information activities that are not commonly seen.”

The CA confirmed Mr. Teodoro’s appointment as Defense chief, a post he had previously assumed during the Arroyo administration.

Green rights group dubs Philippines as ‘deadliest’ in Asia

September 13, 2023 | 8:27 pm

crime-scene-tape — STOCK PHOTO | Image by kjpargeter from Freepik

By Kyle Aristophere T. Atienza, Reporter

THE PHILIPPINES has remained the deadliest country in Asia for environmental and land defenders for a decade now, according to rights watchdog Global Witness, which noted that 11 of the 16 killings in the region last year happened in the archipelago.

Globally, the Philippines was the fifth most dangerous country for environmentalists in 2022, followed by Colombia with 60 killings, Brazil with 32, Mexico with 31, and Honduras with 14, the group’s latest report said.

Since 2012, a total of 281 defenders have been killed in the Philippines, a third of whom were “linked to defenders speaking out against company operations linked to the mining sector,” Global Witness noted.

Last year, at least 177 environmental defenders were killed, bringing the total to 1,910 since 2012 — a statistics that can be translated to an environmentalist being killed every other day.

“Although the overall figure is slightly lower last year than in 2021, when we recorded 200 killings, this does not mean that the situation has significantly improved,” the report said.

Global Witness said the climate crisis and the increased demand for agricultural commodities, fuel and minerals will “intensify the pressure on the environment” and “those who risk their lives to defend it.”

“Increasingly, non-lethal strategies such as criminalization, harassment and digital attacks are also being used to silence defenders,” it added.

Global Witness noted that President Ferdinand R. Marcos, Jr. has, so far, failed to address human rights violations since he took office in June 2022.

“Instead, he has focused his agenda on business and economic interests, raising continued concerns amongst civil society about an increase in mining and other resource exploitation at the cost of human rights and the safety of defenders,” it said.

The Marcos administration has eased rules for foreign investments in a bid to make the country an investment hub, welcoming foreign investors interested in mining and renewable energy projects, among other critical programs.

It has also created a green lanes program that requires national government agencies to fast-track the approval of necessary permits for investments that it considers strategic, covering projects that involve mining for key minerals such as nickel and copper, which are on demand as rich countries have been on race to manufacture solar panels, wind turbines, electric vehicles, among other technologies critical to a low carbon future.

But environmental watchdogs have warned that pre-investment requirements like environmental impact assessments and consent of indigenous and local communities could be ditched due to the investment program.

Asked about the report, the Department of Environment and Natural Resources (DENR) said it was not in a position to make a comment. “We don’t know the circumstances of each of the cases,” the DENR said in a reply to reporters.

However, it stressed that there are about 2,500 forest rangers, forest protection officers and other personnel at the provincial and community levels “who are also protecting the environment.”

Global Witness has cited the “widespread” criminalization of defenders and rights advocates, “with ‘red-tagging’ — the government practice of accusing activists of communist insurgency — commonly used to silence critics and communities.”

“The fact that the Philippines has remained the worst country in Asia for defenders for a decade now is nothing short of alarming,” Jon Bonifacio, national director of Kalikasan People’s Network, a coalition of green groups, said in a Facebook Messenger chat.

“While there’s been a lot of lip service around human rights and climate justice, the Marcos administration has not bothered to even comment or speak up about the human rights crisis our environmental defenders are going through,” he said.

5M Filipino kids lived in extreme poverty in 2022 — UN report

September 13, 2023 | 8:26 pm

By Luisa Maria Jacinta C. Jocson, Reporter

A TOTAL of 12.4% of Filipino children have been living in extreme poverty in 2022, the latest policy research working paper released by the United Nations International Children’s Emergency Fund (UNICEF) and the World Bank showed.

The figure is equivalent to around 5.14 million children who live in extreme poverty in the Philippines. Extreme poverty is defined in this context as living on less than $2.15 (about P121) a day.

The report also showed 43% of Filipino children or around 17.8 million were living on less than $3.65 (P206) a day, which is the average poverty line for lower middle-income economies.

Meanwhile, 77.7% or over 32 million Filipino children were living on less than $6.85 (P387) or the poverty line for upper-middle income countries.

The report found that children remain disproportionately affected by extreme poverty, as 15.9% of children globally are living in extremely poor households, against 6.6% of adults.

“Children who are younger than 18 years comprise more than 50% of those living in extreme poverty, although their share of the population is 31%,” UNICEF and the World Bank said.

Globally, 333 million children were living in extreme poverty last year with 829 million of them living below $3.65 per day and 1.43 billion living below $6.85 per day.

Meanwhile, the report also showed that extreme child poverty rates declined to 15.9% from 20.7% between 2013 and 2022.

“While this lifted 49.2 million children out of extreme poverty, this was about 30 million less than what was projected in the absence of COVID-19-related disruptions,” the report said.

East Asia and the Pacific showed the “most significant decrease” in extreme poverty between 2013 and 2022.

“It is more critical than ever that all children have a clear pathway out of poverty — through equitable access to quality education, nutrition, health, and social protection, as well as safety and security,” World Bank Global Director for Poverty and Equity Luis Felipe Lopez-Calva said in a statement.

“The analysis shows that these policy portfolios need to consider both the common and distinct vulnerabilities and deprivations of children living in fragile and conflict prone settings, children in large households, younger children, children in rural settings, children in households where the head has no or little education — as these are more likely than other children to be living in extreme poor households,” according to the report.

FUNDS CUT FOR WOMEN, CHILDREN — LAWMAKER
In the Philippines, a lawmaker sounded the alarm on Wednesday over budget cuts on programs intended for children and women and criticized bigger allocations for agencies’ confidential and intelligence funds.

“We are dismayed by the prioritization of confidential funds, which have historically been prone to corruption, at the expense of crucial programs for women and children. This is a clear reflection of the government’s misplaced priorities,” Party-list Rep. Arlene D. Brosas said in a statement.

Under the P5.768-trillion proposed budget for next year, the government’s Family Planning and Reproductive Health program received zero funding.

The Council for the Welfare of Children suffered a 31.22% decrease to P94.09 million, the Juvenile Justice and Welfare Council’s budget is 45.03% lower to P117.88 million, while the National Authority for Child Care has a P298.49-million budget or a 31.23% decrease.

“These programs play a vital role in safeguarding the rights and well-being of women and children. Slashing their budgets jeopardizes their access to essential services and support systems amid the economic problems plaguing our country,” she said. — with Beatriz Marie D. Cruz

Keep CoA audit memos public — senator

September 13, 2023 | 8:25 pm

risa-hontiveros — PHILSTAR FILE PHOTO/ SENATE PRIB/JOSEPH VIDAL

By John Victor D. Ordoñez, Reporter

A PHILIPPINE Senator on Wednesday opposed the Ombudsman’s proposal to remove provisions in the national budget requiring the publication of the Commission on Audit’s (CoA) initial reports on government agencies, saying such a change only hinders transparency.

“The non-publication of audit observation memoranda (AOM) by the CoA will only weaken the government’s ability to promptly flag and investigate irregularities involving public money,” Senator Ana Theresia N. Hontiveros-Baraquel said in a statement.

“These audit observations have been historically important in getting to the bottom of issues that involve the misuse of public coffers,” she added.

During a House of Representatives hearing on the Office of the Ombudsman’s budget on Monday, Ombudsman Samuel R. Martires recommended Congress to remove the requirement mandating the CoA to publish audit recommendations of each government agency to “prevent confusion.”

“It is causing confusion because people would read an error in a P10-million project and would think that the government official earned [from the project…but it just] didn’t submit a receipt,” he said.

But on Wednesday, the Office of the Ombudsman clarified that Mr. Martires did not want CoA’s annual audit report of an agency to be published, noting that only the final audit report should be published since initial reports could still be appealed.

“The Office is fully committed in pursuing its mandate as protectors of the people by ensuring that its processes are fully aligned with integrity, transparency and accountability in public service,” it said.

PhilSys IDs to be on cellphones

September 13, 2023 | 8:24 pm

THE DEPARTMENT of Information and Communications Technology (DICT) on Wednesday said it would issue a digital version of the Philippine Identification System ID (PhilSys ID) that would be loaded on mobile phones — a temporary but immediate remedy amid the long delays in the distribution of the physical cards.

“The President tasked the DICT to figure out how do we now deploy a national ID without having to wait forever for the plastic ID card,” Information Technology Secretary Ivan E. Uy said at a Palace briefing after a meeting with President Ferdinand R. Marcos, Jr.

Mr. Uy said the President has grown impatient over the matter, so the DICT prepared a study and a plan to deploy a national digital ID “which is an identity system that can be loaded on your respective mobile phones.”

“This is already a leapfrogging because in most countries, developed countries in the world, they are actually using digital IDs rather than physical card IDs because this has more use cases and it allows for better online transactions,” he said.— Kyle Aristophere T. Atienza

Stop weaponizing law — group

September 13, 2023 | 8:23 pm

A GLOBAL human rights watchdog called on the government to stop “weaponizing the law” against its critics, citing the prosecution of prized journalist and Rappler Holdings Corp. Chief Executive Officer Maria A. Ressa as one such case.

The International Coalition of Human Rights (ICHRP) made the call following Ressa’s victory in court on Tuesday in one of the tax evasion cases filed against her and her media company by the previous administration.

“The court ruling vindicates our view, and the government should cease forthwith its abuse of the judicial process and its entire policy of political repression,” the ICHRP said in a Twitter message.

It reminded the administration of President Ferdinand R. Marcos, Jr. that harassing government critics and journalists with lawsuits violates their freedom of expression and basic workers’ rights.

Presidential Communications Office chief Cheloy Velicaria-Garafil did not immediately reply to a Viber message seeking comment. — John Victor D. Ordoñez

GSIS lot devoted for housing

September 13, 2023 | 8:22 pm

THE GOVERNMENT Service Insurance System (GSIS) has turned over a 14,000-square meter property in Sta. Mesa, Manila to the Social Housing Finance Corporation (SHFC) for the construction of the Pambansang Pabahay high-rise condo project.

GSIS sold the property for P258 million to SHFC for housing projects that will benefit nearly 1,000 informal settler families living in critical zones, GSIS said in a statement on Wednesday.

The beneficiaries will also include members of the Ugnayang Lakas ng mga Apektadong Pamilya sa Baybaying Ilog Pasig at mga Tributaryo (ULAP-Manila).

SHFC President and Chief Executive Officer Federico A. Laxa expressed thanks to the GSIS, led by its president and general manager, Jose Arnulfo A. Veloso, for “their quick response so that the deed of sale could be signed as soon as possible, and housing provided immediately to families who need it.”

GSIS began the Pabahay Para sa Bagong Bayaning Manggagawa (PBBM) housing program in May with a three-pronged strategy to help reduce the housing shortage in the country.

The first strategy is the Lease with Option to Buy (LWOB) Program which allows potential homeowners to acquire a GSIS property without an initial down payment. Potential homeowners can choose from 15,000 residential properties available nationwide.

The second is the Housing Accounts Restructuring and Condonation Program (HARCP), which waives all outstanding penalties and surcharges. The program also provides extended payment terms for eligible borrowers and has been extended to 2025.

Lastly, GSIS will construct housing condominiums for government employees in properties in Fairview, Quezon City, and Cogeo in Antipolo City.

GSIS makes each payment plan based on the salary grades of government workers to make the homes more accessible. “Every Filipino deserves the basic right to safe, affordable and secure housing,” Mr. Veloso said. — Aaron Michael C. Sy

More TESDA programs urged

September 13, 2023 | 8:22 pm

SENATORS EXHORTED the Technical Education and Skills Development Authority (TESDA) on Wednesday to come up with more programs for retirees to remain productive and set targets for skills training for out-of-school youth.

“Having seen the transformative power of proper skills training firsthand, I have consistently supported efforts providing greater opportunities and empowering Filipinos through skill-based education and sustainable livelihood programs,” Senator Regina “Loren” B. Legarda said at the hearing on TESDA’s P15.2-billion proposed budget for 2024.

She urged TESDA to develop more programs for retirees and revealed her plan to file a measure creating “lifelong institutes” in state universities and colleges for the same demographic.

On the other hand, Senator Alan Peter S. Cayetano said TESDA should craft more programs to help equip out-of-school youth with skills needed for them to land decent jobs.

“I want to see at the end of the budget hearing, how many are out-of-school youths, how many are the targets and how much per capita will we put on them, so that at the end of the Marcos administration, we can look back and say, did we meet our target, he said. — John Victor D. Ordoñez

CTA denies coop’s P12-M claim

September 13, 2023 | 8:22 pm

THE COURT of Tax Appeals (CTA) has denied the Benguet Electric Cooperative’s (BENECO) refund claim of P12.13 million, representing its deficiency minimum corporate income tax for the year 2015.

In a 20-page decision dated Sept. 11, the tribunal said it did not have jurisdiction to rule on the tax dispute since the firm failed to file an appeal on time.

“After the lapse of the 180-day period under the law in 2018, there is already an inaction on the part of the respondent commissioner of internal revenue and petitioner (Benguet Electric) should have filed a judicial appeal within 30 days after,” Associate Justice Jean Marie A. Bacorro-Villena said in the ruling. — John Victor D. Ordoñez

152 pawikan hatchlings released at Aboitiz Cleanergy Park

September 13, 2023 | 8:22 pm

DAVAO CITY — A whole community took part in Davao Light and Power Company’s (Davao Light’s) releasing of 152 pawikan hatchlings at the Aboitiz Cleanergy Park in Punta Dumalag, Davao City on Tuesday afternoon.

Vice President and Education Secretary Sara Z. Duterte-Carpio joined several private schools and universities representatives in the activity. Representatives of government and non-government organizations also participated in the release of pawikan hatchlings.

Fermin Edillon, head of reputation department of Davao Light, said the hatchlings were from the third pawikan nest found at the park earlier this year.

In 2019, then-Davao City mayor Duterte-Carpio signed a joint Memorandum of Agreement (MoA) with the Department of Environment and Natural Resources 11 (DENR 11) and Davao Light to further strengthen the protection and conservation of marine life, particularly the endangered hawksbill turtles.

Since the park was established as the Pawikan Rescue Center in 2014, more than 7,650 hatchlings have been released. At present, there are seven rescued pawikans under the care of Aboitiz Cleanergy Park, said Mr. Edillon. — Maya M. Padillo