MANILA, Philippines - To ensure the payment of correct taxes, the Bureau of Internal Revenue (BIR) has imposed stricter rules on contractors for government's infrastructure projects.
Under revenue memorandum circular 63-2014 dated August 8, 2014, the BIR is now requiring all contractors of the Department of Public Works and Highways (DPWH) to file an application for the final payment release certificate with the BIR.
"All contractors engaged by the government to contract infrastructures and other projects are required to file an application for contractor's final payment release certificate—BIR form No. 0217 (formerly BIR form No. 2555)… before the release of final payment by the DPWH. The said application shall be submitted by the contractor to the BIR 30 days before the filing a claim for the release of final payment by the DPWH," the BIR said.
Based on the application form, contractors should disclose the following:
-total contract price of projects;
-progress billing collected;
-final withholder value-added tax;
-creditable withholding tax;
-total amount previously collected; and
-taxes withheld and collectible final payment.
DPWH Secretary Rogelio Singson earlier said if a contractor pays higher income tax, this means that it has a higher net worth and the financial capacity to undertake government projects.