24 September 2019

BUREAU OF INTERNAL REVENUE

BIR National Office Building,
Agham Road, Diliman,
Quezon City, Philippines

Attention: MS. SYLVIA R. ALMA JOSE

Chief, Litigation Division

Re: Tax Amnesty Availment for Final Withholding Tax

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Gentlemen:

We write on behalf of our client Subic Water & Sewerage Co. Inc. (“SWSCI”).
This is to inform your good Office of SWSCI’s intent to avail of the tax amnesty under
Republic Act No. 11213 (RA 11213), otherwise known as the Tax Amnesty Act, for the
deficiency final withholding tax (“FWT”) assessment for taxable period 1 April to 31
December 2011.

Background

On 14 August 2019, the Court of Tax Appeals Special Second Division (“CTA”)
issued a decision partially denying SWSCI’s Petition for Review (“14 August 2019
Decision). Among the CTA’s findings, it held SWSCI liable for FWT on payments made
to Sembcorp Utilities Services, Ltd. As such, SWSCI was ordered to pay the amount of
₱9,347,043.20, representing basic deficiency FWT, inclusive of 25% surcharge, 20%
deficiency interest, and 20% delinquency interest, computed as follows:

Deficiency Less: Payment Remaining

on
FWT Balance
May 29, 2015
Basic Deficiency FWT ₱ 2,723,302.97 ₱ 5,000.00 ₱ 2,718,302.97
Surcharge (25%) 680,825.74 1,250.00 679,575.74
Deficiency Interest (20%) from
January 14, 2012 to May 20, 2015
(P2,723,302.97 x 20% x 1,223
days/365 days 1,824,986.05 3,120.55 1,821,865.50
Total Amount Due, May 20, 2015 ₱ 5,229,114.76
Deficiency Interest (20%) from
May 21, 2015 until payment on
May 29, 2015 (P2,723,302.97 x
20% x 9 days/365 days) 13,429.99 13,429.99
Compromise Penalty 25,000.00 (25,000.00)
Total Amount Due, May 29, 2015 ₱ 5,242,544.75 ₱ 34,370.55 ₱ 5,208,174.20
Deficiency Interest (20%) from
May 30, 2015 to December 31,
2017 (P2,718,302.97 x 20% x 947
days/365 days) 1,410,538.58
Delinquency Interest (20%)
from May 21, 2015 until
payment on May 29, 2015
(P5,229,114.76 x 20% x 9
days/365 days) 25,787.42
from May 30, 2015 until
December 31, 2017
(P5,208,174.20 x 20% x 947
days/365 days) 2,702,543.00

Total Deficiency FWT Due as of

December 31, 2017
₱ 9,347,043.20

In addition, SWSCI is asked to pay 12% delinquency interest starting 1 January

2018 under Republic Act No. 10963, or the TRAIN Law.

Basis for Availment

SWSCI intends to avail of tax amnesty for the assessed deficiency FWT under RA
1121, particularly under Section 17(d), in relation to Section 18(d) thereof, as follows:

Section 17. Coverage. – x x x

2
 For purposes of this Act, the Tax Amnesty on Delinquencies may
be availed of in the following instances:

xxx

(d) Withholding tax agents who withheld taxes but failed to remit
the same to the Bureau of Internal Revenue.

xxx

Section 18. Entitlement of Tax Amnesty on Delinquencies. - Any

person may enjoy the immunities and privileges of the Tax Amnesty on
Delinquencies and pay the following tax amnesty rates:

xxx

(d) Withholding agents who withheld taxes but failed to remit the
same to the Bureau of Internal Revenue……… 100% of the basic tax
assessed.

The above provisions are mirrored in Sections 3(D) and 4(D) Revenue
Regulations No. 4-2019 (RR4-2019), which implements RA 11213.

Given the foregoing, SWSCI requests your good Office to issue the necessary
Certificate of Tax Delinquency/Tax Liabilities (CTD)1 pertaining to the Basic Deficiency
Tax FWT in the amount of P2,718,302.97. Also, attached for your perusal and
consideration are SWSCI’s: (1) Tax Amnesty Return (TAR); 2 (2) Acceptance Payment
Form (APF);3 and (3) the 14 August 2019 CTA Decision.4 Upon issuance of the CTD,
kindly endorse the APF for SWSCI to process the tax amnesty payment.

We hope that our submissions are sufficient for this request.

Very truly yours,

ANGARA ABELLO CONCEPCION REGALA & CRUZ

By:
OLIVER L. PANTALEON

1
Under Revenue Memorandum Order No. 23-2019, the CTD is to be issued by your good
Office within five (5) days from receipt of this request letter.
2
A copy of BIR Form No. 2118-DA is attached hereto as Annex A.
3
A copy of BIR Form No. 0621-DA is attached hereto as Annex B.
4
A copy of the 14 August 2019 CTA Decision is attached hereto as Annex C.
3
 ERIC R. RECALDE

KAREN ANDREA D. TORRES

GREGORIO L. DE LIMA III

KRISTEL MARIZ G. MARAJAS

Copy furnished:

COMM. CAESAR R. DULAY

BUREAU OF INTERNAL REVENUE
BIR National Office Building,
Agham Road, Diliman,
Quezon City