RR No. 16-2013: Revokes RR Nos. 16-2003 and 24-2003 relative to the taxation of privilege stores and imposes new rules

Key points

1. Obligations of organizers or exhibitors. They post their BIR Certificate of Registration and withhold Expanded Withholding Tax on lease payments to the lessor. They give the RDO a list of participants with addresses, stall numbers, TINs and operating dates. They keep books and issue receipts, and provide CRM/POS machines or allow use of their own manual receipts or invoices for operators.
2. More organizer duties. They ensure tenants present a TIN and receipts or invoices, submit an Information Statement on Privilege Store Activities, and show proof of withholding tax payment. They ensure the List of Sales is submitted within 5 days after the operation and report non-compliance to the BIR.
3. Obligations of privilege store operators. Operators withhold Expanded Withholding Tax on rent paid to the organizer or lessor, and file income tax returns. They submit the Information Statement, keep books, issue receipts or invoices, and give the List of Sales to the organizer.
4. Regular tenants. Tenants not classified as privilege store operators withhold Expanded Withholding Tax on rent, keep books and issue receipts. They file income, withholding, business (percentage or VAT) and other returns and information returns.
5. More than 15 days of operation. An operator whose business runs more than 15 days ceases to be a privilege store operator. It is then governed by the rules for regular taxpayers.
6. RDO monitoring. RDOs monitor compliance and validate the organizer’s participant list through the BIR registration system. They may recommend Mission Orders from the Regional Director so Revenue Officers can check compliance, especially return filing.

Who is affected

• Organizers or exhibitors of privilege stores
• Privilege store operators
• Lessees and tenants who are regular taxpayers

Deadlines and effectivity

• List of Sales due within 5 days after the privilege store operation
• Operations beyond 15 days: operator treated as a regular taxpayer