Question & AnswerQ&A (SEC Notice)
The main subject is the imposition of Value-Added Tax (VAT) on toll fees paid by private motor vehicles to Tollway Operators.
It clarifies RMC No. 72-2009 and reiterates the provisions of RMC No. 52-2005.
Tollway Operators are subject to VAT under Section 108 of the NIRC of 1997, as amended.
VAT on toll fees from private motor vehicles became applicable effective April 1, 2010.
No, VAT on toll fees from private motor vehicles is implemented first, while VAT on fees from other transportation vehicles is to be implemented subsequently.
The transition period aims to mitigate any impact that the imposition of VAT may have on the riding public.
All revenue officials and employees are enjoined to widely publicize the Circular.
Section 108 mandates that Tollway Operators must charge and remit VAT for the toll fees they collect, making them VAT-registered persons subject to tax compliance requirements.
The Circular does not explicitly mention penalties, but as it enforces VAT imposition under the NIRC, penalties under the tax code for non-compliance would apply.
Toll fees collected prior to April 1, 2010 from private vehicles were not subject to VAT under this Circular and were covered by the transition period.