Summary
RR No. 13-2001 implements Tax Code provisions on the Commissioner’s authority to abate or cancel tax liabilities.
Key points
- Grounds. The tax or part of it appears unjustly or excessively assessed, or the administration and collection costs do not justify collecting the amount due. Disputed assessments, including those void from the beginning, are not covered.
- Unjust or excessive penalties and interest. Examples include filing or payment at the wrong venue and a mistake caused by erroneous written official advice of a revenue officer. Others are failure to file and pay on time due to substantial losses from prolonged labor dispute, force majeure or legitimate business reverses, non-compliance due to difficult interpretation of law, and circumstances beyond the taxpayer’s control. Late payment under meritorious circumstances specified in the Regulations also qualifies.
- Costs exceed amount collected. Penalties may be abated where an assessment is confirmed by a lower court but appealed, or for withholding tax assessments or delayed installment payments under meritorious circumstances. They may also be abated where an assessment was reduced after reinvestigation but is still contested, or in analogous instances the Commissioner deems fit.
- Scope of abatement. The authority generally applies to surcharge and compromise penalties only. In meritorious instances the Commissioner may also abate interest and the basic assessed tax, with such cases coursed through the Deputy Commissioners for Operations Group and Legal and Inspection Group.
Who is affected
- Taxpayers with penalties, interest or assessments they consider unjust or excessive
Summary by Tax Resources PH. It is not a substitute for the full text of the issuance or professional advice.
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