Nature and Imposition of Gross Receipts Tax
- GRT is a percentage tax imposed on persons or entities engaged in selling or leasing goods or services in the Philippines.
- It is a business tax imposed on gross income without deductions, reflecting the privilege of engaging in business.
- Section 121 imposes GRT on banks and non-bank financial intermediaries performing quasi-banking functions.
- Section 122 imposes GRT on other non-bank financial intermediaries and persons performing similar financing activities.
Definitions Under the Regulations
- Banks or Banking Institutions: Entities engaged in lending funds obtained from deposits, as defined by the General Banking Law of 2000, including various banking types recognized by the BSP.
- Non-bank Financial Intermediaries: Entities engaged principally in lending, investing, or placing funds received from the public through debt instruments or certificates, on their own or others' account.
- Quasi-banking Functions: Borrowing from twenty or more lenders through debt instruments (other than deposits) for relending or purchasing receivables; excludes non-financial companies borrowing for internal financing.
- Deposit Substitutes: Alternative modes of obtaining funds from twenty or more lenders via issuance of debt instruments or other financing means.
- Banking Activities: Commercial banking operations such as accepting deposits, issuing credit instruments, buying and selling foreign exchange, acquiring securities, and extending credit as regulated by BSP.
Role and Status of Bangko Sentral ng Pilipinas (BSP)
- BSP is an independent central monetary authority established pursuant to the 1987 Constitution and Republic Act No. 7653.
- It provides monetary, banking, and credit policy direction and supervises bank ratios and finance companies.
- BSP’s primary mandate is to maintain price stability conducive to balanced economic growth and monetary stability.
- Activities and transactions of BSP are governmental functions mandated by law and not commercial endeavors.
- Revenues generated by BSP in performance of its functions are not subject to GRT as imposition of tax on BSP could hinder its policy implementation and economic role.
- BSP is not classified as a bank, non-bank financial intermediary, or engaging in similar banking or financing activities for GRT purposes.
Exclusion of BSP Transactions from Gross Receipts Tax
- Transactions undertaken by BSP during the exercise of its legally-mandated functions are excluded from GRT imposed under Sections 121 and 122 of the NIRC.
- This exclusion is consistent with BSP’s constitutional and statutory mandate.
Separability Clause
- If any provision of these Regulations is declared unconstitutional or invalid, all other provisions shall remain in full force and effect.
Repealing Clause
- All rules, regulations, or parts thereof inconsistent with these Regulations are amended or repealed accordingly.
Effectivity
- These Regulations take effect fifteen (15) days after their publication in a newspaper of general circulation.