RMC No. 72-2018: Reiterates/supplements the existing policies, guidelines and procedures relative to the validation and monitoring of sales declaration of taxpayers generated from POS/CRM/SPM/other sales receipting system software, receipting/invoicing of Computerized Accounting System (CAS), including online sales transactions; and from manual invoices/receipts/supplemental commercial documents

Key points

1. Post evaluation and machine inventory. Post evaluation may be done together with other enforcement activities such as Tax Compliance Verification Drive, surveillance, inventory stocktaking and audit. All machines and software are inventoried and matched with the BIR database using a Post Evaluation Guide (PEG) Form, and the taxpayer explains discrepancies and unmatched machines in writing within five (5) days from receipt of the Letter Notice.
2. Sales data to be extracted. Z-Readings, e-Journals and back-end reports are taken from all sources, including online sales and unregistered machines. The taxpayer submits the extracted Z-Reading and e-Journal not later than the second day of the Post-Evaluation, and records and manual invoices are covered too.
3. Unregistered and withdrawn machines. The Revenue Officer issues an apprehension slip and seals unregistered machines after extracting sales data. They can be unsealed upon registration and payment of deficiency taxes and penalties. Machines withdrawn for retirement, sale, repair, upgrade, modification or transfer get an immediate Z-Reading and are reset to zero after the inspection report is approved.
4. Subpoena and best evidence. A Subpoena Duces Tecum compels missing documents or machines. Failure to comply warrants the Best Evidence Obtainable Rule, such as dividing total sales of existing machines by their number to get average monthly sales per machine, and referral for a criminal case.
5. Comparison with eSales. Z-Reading sales are compared with eSales and the e-Journal. If the e-Journal amount is higher than the reported eSales, the taxpayer is liable for under declaration of sales. If it is lower, the violation equals non-issuance of an invoice or receipt, or issuing an unregistered receipt, dealt with under Sec. 264 of the NIRC.
6. Penalties. Failing to transmit sales data to the electronic sales reporting system carries a daily penalty of one-tenth of one percent (1/10 of 1%) of annual net income or Ten Thousand Pesos (P10,000), whichever is higher, plus permanent closure beyond one hundred eighty (180) days in a taxable year. Using sales suppression software or devices carries a fine of P500,000.00 to P10,000,000.00 and two (2) to four (4) years of imprisonment, and each failure to file an information return or keep records costs P1,000.00, up to P25,000.00 per calendar year.

Who is affected

• Taxpayers using POS/CRM/SPM, other sales receipting software, CAS or manual invoices and receipts
• Service providers and developers of those systems

Deadlines and effectivity

• Explanation of discrepancies within five (5) days from receipt of the Letter Notice
• Z-Reading and e-Journal not later than the second day of Post-Evaluation