Case Digest (G.R. No. 167679)
Facts:
In ING Bank N.V. Manila Branch v. Commissioner of Internal Revenue, ING Bank N.V., the Philippine branch of a Dutch banking corporation, received a Final Assessment Notice dated December 3, 1999, covering multiple deficiency taxes for the taxable years 1996 and 1997, including documentary stamp tax, onshore tax, branch profit remittance tax, and withholding tax on compensation. ING Bank paid minimal compromise penalties for certain items and protested the remainder totaling ₱672,576,939.18. On October 26, 2000, it filed CTA Case No. 6187 for cancellation of these assessments. After trial, the Court of Tax Appeals (CTA) Second Division, in its August 9, 2004 Decision, cancelled deficiency income tax and branch profit remittance tax but upheld (a) deficiency documentary stamp tax on special savings accounts for 1996 and 1997, (b) deficiency onshore tax for 1996, and (c) deficiency withholding tax on compensation for 1996 and 1997, ordering payment of ₱240,106,928.94 plus interest
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Case Digest (G.R. No. 167679)
Facts:
- Parties and Procedural History
- ING Bank N.V. Manila Branch (petitioner) filed a Petition for Review under Rule 45 of the Rules of Court, assailing CTA Second Division Decision (Aug. 9, 2004) and Resolution (Nov. 12, 2004), and CTA En Banc Decision (Apr. 5, 2005).
- Respondent is the Commissioner of Internal Revenue (CIR).
- BIR Assessments and CTA Proceedings
- Final Assessment Notice dated Dec. 3, 1999 covered deficiency national internal revenue taxes for taxable years 1996–1997, including income tax, documentary stamp tax (DST), onshore tax, branch profit remittance tax, withholding tax on compensation, and compromise penalties, totaling ₱672,652,691.65.
- ING Bank paid minimal amounts (₱1,000 and ₱75,013.25) and protested remaining assessments totaling ₱672,576,939.18. It filed CTA Case No. 6187 on Oct. 26, 2000.
- CTA Second Division (Aug. 9, 2004) CANCELLED assessments for deficiency income tax, branch profit remittance tax, and certain DST; UPHELD deficiency withholding tax on compensation (1996 & 1997), deficiency onshore tax (1996), and DST on special savings accounts (1996 & 1997), amounting to ₱240,106,928.94 plus 20% interest per annum from Feb. 3, 2000.
- Motions for Reconsideration were DENIED (Nov. 12, 2004). CTA En Banc dismissed ING Bank’s appeal for lack of merit (Apr. 5, 2005). ING Bank then filed Petition for Review before the Supreme Court.
- Tax Amnesty Manifestation
- On Dec. 14, 2007, while SC petition pending, ING Bank filed Notice of Availment of Tax Amnesty under Republic Act No. 9480, with:
- Statement of Assets, Liabilities & Net Worth (SALN) as of Dec. 31, 2005;
- Tax Amnesty Return (BIR Form 2116);
- Tax Amnesty Payment Form (BIR Form 0617) reflecting payment of ₱500,000.00.
- ING Bank claimed entitlement to immunities under RA 9480, particularly extinguishment of DST on special savings accounts (1996–1997) and onshore interest tax (1996).
- Contentions
- ING Bank argues it is qualified under Sections 5 & 8 of RA 9480; complied with all requirements; RMC No. 19-2008 (excluding pending cases ruled in favor of BIR) is invalid.
- CIR contends ING Bank is disqualified because CTA decisions (even without finality) ruled in favor of BIR; RMC No. 19-2008 grants CIR discretion to evaluate amnesty applications.
Issues:
- May ING Bank validly avail itself of the tax amnesty granted by RA No. 9480 despite pending CTA decisions favoring the BIR?
- Is ING Bank liable for deficiency withholding tax on accrued bonuses for taxable years 1996 and 1997?
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)