Objectives and Nature of the Monetization Program
- The program facilitates qualified VAT-registered taxpayers to obtain cash equivalents of their outstanding VAT Tax Credit Certificates (TCCs).
- Aims to foster a conducive business environment and enhance government credibility domestically and internationally.
Mechanism of VAT TCC Monetization
- Qualified taxpayers may either:
- Receive discounted cash value in advance from a trustee bank; or
- Collect full cash value of TCCs on a maturity date as determined by the Bureau of Internal Revenue (BIR) or Bureau of Customs (BOC).
- Implementation details to be prescribed through rules and regulations.
Scope and Coverage
- Covers outstanding VAT TCCs pursuant to Section 112 (A) of RA 8424 and VAT component of drawback TCCs pursuant to Section 106 (e) of the TCCP.
Program Duration and Funding
- Spans a five-year period from 2012 to 2016.
- Funding included in the National Expenditure Program (NEP) for the specified years.
Duties and Responsibilities of Government Agencies
- Department of Budget and Management (DBM): Ensures inclusion of funding in NEP and releases appropriated amounts upon request from the Department of Finance (DOF).
- Department of Finance (DOF): Directs BIR and BOC to verify outstanding TCCs, provide confirmation letters, endorse financial applications, arrange trustee bank accounts, and coordinate with Bureau of Treasury facilities.
- BIR and BOC: Verify TCCs and issue Notices of Payment Schedule to holders.
- Government Financial Institutions (GFIs): Act as trustee banks and establish special trust accounts for monetization.
- Commission on Audit (COA): Audits all transactions related to the monetization program.
Implementing Rules and Regulations
- The DBM, DOF, BIR, and BOC are jointly tasked to issue the implementing rules and regulations (IRRs) for the program.
Discontinuation of Regular VAT TCC Issuance
- Starting 2012, BIR and BOC shall no longer issue VAT TCCs unless applied for by taxpayers under the relevant statutes.
Repealing and Separability Clauses
- Inconsistent prior issuances, orders, rules, or regulations are repealed or modified.
- Invalidity of any provision will not affect other valid provisions.
Effectivity
- The Executive Order takes effect immediately upon publication in a newspaper of general circulation.