GENERAL PRINCIPLES OF TAXATION

 
FUNDAMENTAL PRINCIPLES IN TAXATION
 
 
Taxation
 
                     Taxation is the inherent power of the sovereign, exercised through the legislature, to
impose burdens upon subjects and objects within its jurisdiction for the purpose of
raising revenues to carry out the legitimate objects of government.
 
                     It is also defined as the act of levying a tax, i.e. the process or means by which the
sovereign, through its law-making body, raises income to defray the necessary expenses
of government. It is a method of apportioning the cost of government among those
who, in some measure, are privileged to enjoy its benefits and must therefore bear its
burdens.
 
Taxes
 
                     Taxes are the enforced proportional contributions from persons and property levied by
the law-making body of the State by virtue of its sovereignty for the support of the
government and all public needs.
 
Essential elements of a tax
 
1.       It is an enforced contribution.
 
2.       It is generally payable in money.
 
3.       It is proportionate in character.
 
4.       It is levied on persons, property, or the exercise of a right or privilege.
 
5.       It is levied by the State which has jurisdiction over the subject or object of taxation.
 
6.       It is levied by the law-making body of the State.
 
7.       It is levied for public purpose or purposes.
 
BIR
*What is BIR?
The Bureau of Internal Revenue is an agency of Department of Finance. BIR collects
more than half of the total revenues of the government. Caesar Dulay is the current
Commissioner of BIR.
MANDATE
The Bureau of Internal Revenue shall be under the supervision and control of the
Department of Finance and its powers and duties shall comprehend the assessment
and collection of all national internal revenue taxes, fees, and charges, and the
enforcement of all forfeitures, penalties, and fines connected therewith, including the
execution of judgments in all cases decided in its favor by the Court of Tax Appeals and
the ordinary courts. The Bureau shall give effect to and administer the supervisory and
police powers conferred to it by this Code or other laws. (Section 2 of the National
Internal Revenue Code of 1997)

MISSION
We collect taxes through just enforcement of tax laws for nation-building and the
upliftment of the lives of Filipinos

VISION The Bureau of Internal Revenue is an institution of service excellence and

integrity.

GUIDING PRINCIPLE "Service Excellence with Integrity and Professionalism"

*What are the policies that govern BIR?

National Tax Law

I. 1987 Constitution

The 1987 Philippine Constitution sets limitations on the exercise of the power to tax.
The rule of taxation shall be uniform and equitable.
 All money collected on any tax levied for a special purpose shall be treated as a
special fund and paid out for such purpose only.
 The Congress may, by law, authorize the President to fix within specified limits, and
subject to such limitations and restriction
 The Supreme Court shall have the power to review, revise, reverse, modify or
affirm on appeal or certiorari, as the law or the Rules of Court may provide, final
judgments and orders of lower courts
 Tax exemptions are limited to those granted by law

II. Laws

The basic source of Philippine tax law is the National Internal Revenue Law, which
codifies all tax provisions, the latest of which is embodied in Republic Act No. 8424
(“The Tax Reform Act of 1997”).

III. Periodicals
Periodicals on Philippine tax law are the:
(1) Philippine Revenue Service (copies available in the BIR Library), published by the
BIR from 1969-1980;
(2) Philippine Revenue Journal (copies available in the BIR Library) which was both
published by the Bureau of Internal Revenue from 1969 to 2000; and
(3) the Tax Monthly, published by the National Tax Research Center (NTRC) (copies
available in the BIR Library and the NTRC).

VIII. Local Government Tax Law

Local taxes may be imposed, as the Constitution grants, to each local government unit,
the power to create its own sources of revenues and to levy taxes, fees, and charges
which shall accrue to the local governments.

*How was it created/organized?

In the early American regime from the period 1898 to 1901, the country was ruled by
American military governors. In 1902, the first civil government was established under
William H. Taft. However, it was only during the term of second civil governor Luke E.
Wright that the Bureau of Internal Revenue (BIR) was created through the passage of
Reorganization Act No. 1189 dated July 2, 1904. On August 1, 1904, the BIR was
formally organized and made operational under the Secretary of Finance, Henry Ide
(author of the Internal Revenue Law of 1904), with John S. Hord as the first Collector
(Commissioner). The first organization started with 69 employees, which consisted of a
Collector, Vice-Collector, one Chief Clerk, one Law Clerk, one Records Clerk and three
(3) Division Chiefs.

*Where is the BIR reported?

In 2010, the BIR developed a complaint system, serving as an avenue to cater all types
of complaints/concerns, which in turn are being sent to the concerned offices for
resolution. Email facilities and Short Messaging System or SMS were provided to
complement the system. Though, the old system served its purpose, re-engineering for
its utilization and capabilities is much required.
The rebirth of the BIR’s eComplaint System has finally been set for operations. The
enhanced eComplaint system is made simpler, easy to access and user-friendly. The
system handles complaints by mainly logging into the BIR’s website and tapping the
eServices wherein you shall find the eComplaint System.

Within the eComplaint System are sub-components which sets the criteria on specific
types of complaints or concerns, namely:
 eComplaint Home – the homepage describes the system’s background and the set
criteria including its processes for the utilization of the sub-systems;
 eComplaint NO-OR - are complaints for the non-issuance of official
receipts/invoices and matters relative to the issuance of receipts, such as but not
limited to the issuance of Authority to Print Receipts and Cash Register
Machines/Point-of-Sales machines;
 eComplaint DISIPLINA - are complaints and concerns relative to erring BIR
 personnel; Code of Conduct – a detailed compilation pertaining to the present laws
and regulations enforced and must be adopted by all BIR personnel;
 eComplaint R.A.T.E. –pertains to complaints related to Tax Evasion and/or Tax
Avoidance;
 eComplaint OTHERS – are complaints specifically provided for other tax-related
matters not within the context of the other sub-system; and
 eComplaint FAQs – are compilations of “frequently ask questions”, lifted from the
complaints raised thru system.

*What is its structure in the government?

The BIR’s journey with the Performance Governance System (PGS) began in CY 2009,
when it was selected to be one of six (6) National Government Agencies chosen to
participate in a landmark Millennium Challenge Corporation (MCC) Compact Eligibility
endeavor to adopt the Performance Governance System.
PGS is a tool translating statements of governance and vision into actionable strategies
and commitments leading to the realization of breakthrough results. Prior to its selection
for this project, the BIR had already embarked on programs to promote transparency
and accountability in the revenue service, in accordance with the recommendations of
the Integrity Development review (IDR) project implemented in 2007.
The introduction to PGS has helped to further promote our commitment to participatory
governance and partnership with our stakeholders, and has witnessed the renewal of
the public’s trust and confidence in the Government, particularly in the BIR as the
country’s tax collecting agency. Indeed, the BIR has achieved even greater focus and
seen the optional impact of its programs give to the available resources for the
accomplishment of its mandate. Also, the adaptation of the PGS has gained a high level
of attention and is now considered a necessary condition for honest and good
governance, the central tenet of the Aquino Administration.
The PGS has indeed provided excellent directions for the BIR’s efforts to focus on
efficiency, effectiveness, transparency and accountability thereby enabling us to
enhance our performance and productivity and to contribute even more significantly to
the attainment of the country’s development and nation building initiatives.

*What are the duties and the responsibilities?

What are the Bureau of Internal Revenue (BIR) and What Does It Do?
 The Bureau of Internal Revenue (BIR) is the government body under the
Department of Finance that collects taxes and enforces tax laws. Its powers and
duties include the following: *Reduction and collection of all internal revenue taxes,
fees, and charges *Enforcement of all forfeitures, penalties, and fines connected
therewith, including the execution of judgments in all cases decided in its favor by
the Court of Tax Appeals and the ordinary courts *Administration of supervisory and
police powers conferred to it by the National Internal Revenue Code and special
laws.

BIR
*What is BIR?
The Bureau of Internal Revenue is an agency of Department of Finance. BIR collects
more than half of the total revenues of the government. Caesar Dulay is the current
Commissioner of BIR.
MANDATE
The Bureau of Internal Revenue shall be under the supervision and control of the
Department of Finance and its powers and duties shall comprehend the assessment
and collection of all national internal revenue taxes, fees, and charges, and the
enforcement of all forfeitures, penalties, and fines connected therewith, including the
execution of judgments in all cases decided in its favor by the Court of Tax Appeals and
the ordinary courts. The Bureau shall give effect to and administer the supervisory and
police powers conferred to it by this Code or other laws. (Section 2 of the National
Internal Revenue Code of 1997)

MISSION
We collect taxes through just enforcement of tax laws for nation-building and the
upliftment of the lives of Filipinos

VISION The Bureau of Internal Revenue is an institution of service excellence and

integrity.

GUIDING PRINCIPLE "Service Excellence with Integrity and Professionalism"

*What are the policies that govern BIR?

National Tax Law

I. 1987 Constitution

The 1987 Philippine Constitution sets limitations on the exercise of the power to tax.
The rule of taxation shall be uniform and equitable.
 All money collected on any tax levied for a special purpose shall be treated as a
special fund and paid out for such purpose only.
 The Congress may, by law, authorize the President to fix within specified limits, and
subject to such limitations and restriction
 The Supreme Court shall have the power to review, revise, reverse, modify or
affirm on appeal or certiorari, as the law or the Rules of Court may provide, final
judgments and orders of lower courts
 Tax exemptions are limited to those granted by law

II. Laws
The basic source of Philippine tax law is the National Internal Revenue Law, which
codifies all tax provisions, the latest of which is embodied in Republic Act No. 8424
(“The Tax Reform Act of 1997”).

III. Periodicals

Periodicals on Philippine tax law are the:

(1) Philippine Revenue Service (copies available in the BIR Library), published by the
BIR from 1969-1980;
(2) Philippine Revenue Journal (copies available in the BIR Library) which was both
published by the Bureau of Internal Revenue from 1969 to 2000; and
(3) the Tax Monthly, published by the National Tax Research Center (NTRC) (copies
available in the BIR Library and the NTRC).

VIII. Local Government Tax Law

Local taxes may be imposed, as the Constitution grants, to each local government unit,
the power to create its own sources of revenues and to levy taxes, fees, and charges
which shall accrue to the local governments.

*How was it created/organized?

In the early American regime from the period 1898 to 1901, the country was ruled by
American military governors. In 1902, the first civil government was established under
William H. Taft. However, it was only during the term of second civil governor Luke E.
Wright that the Bureau of Internal Revenue (BIR) was created through the passage of
Reorganization Act No. 1189 dated July 2, 1904. On August 1, 1904, the BIR was
formally organized and made operational under the Secretary of Finance, Henry Ide
(author of the Internal Revenue Law of 1904), with John S. Hord as the first Collector
(Commissioner). The first organization started with 69 employees, which consisted of a
Collector, Vice-Collector, one Chief Clerk, one Law Clerk, one Records Clerk and three
(3) Division Chiefs.

*Where is the BIR reported?

In 2010, the BIR developed a complaint system, serving as an avenue to cater all types
of complaints/concerns, which in turn are being sent to the concerned offices for
resolution. Email facilities and Short Messaging System or SMS were provided to
complement the system. Though, the old system served its purpose, re-engineering for
its utilization and capabilities is much required.
The rebirth of the BIR’s eComplaint System has finally been set for operations. The
enhanced eComplaint system is made simpler, easy to access and user-friendly. The
system handles complaints by mainly logging into the BIR’s website and tapping the
eServices wherein you shall find the eComplaint System.

Within the eComplaint System are sub-components which sets the criteria on specific
types of complaints or concerns, namely:
 eComplaint Home – the homepage describes the system’s background and the set
criteria including its processes for the utilization of the sub-systems;
 eComplaint NO-OR - are complaints for the non-issuance of official
receipts/invoices and matters relative to the issuance of receipts, such as but not
limited to the issuance of Authority to Print Receipts and Cash Register
Machines/Point-of-Sales machines;
 eComplaint DISIPLINA - are complaints and concerns relative to erring BIR
personnel; Code of Conduct – a detailed compilation pertaining to the present laws
and regulations enforced and must be adopted by all BIR personnel;
 eComplaint R.A.T.E. –pertains to complaints related to Tax Evasion and/or Tax
Avoidance;
 eComplaint OTHERS – are complaints specifically provided for other tax-related
matters not within the context of the other sub-system; and
 eComplaint FAQs – are compilations of “frequently ask questions”, lifted from the
complaints raised thru system.

*What is its structure in the government?

The BIR’s journey with the Performance Governance System (PGS) began in CY 2009,
when it was selected to be one of six (6) National Government Agencies chosen to
participate in a landmark Millennium Challenge Corporation (MCC) Compact Eligibility
endeavor to adopt the Performance Governance System.
PGS is a tool translating statements of governance and vision into actionable strategies
and commitments leading to the realization of breakthrough results. Prior to its selection
for this project, the BIR had already embarked on programs to promote transparency
and accountability in the revenue service, in accordance with the recommendations of
the Integrity Development review (IDR) project implemented in 2007.
The introduction to PGS has helped to further promote our commitment to participatory
governance and partnership with our stakeholders, and has witnessed the renewal of
the public’s trust and confidence in the Government, particularly in the BIR as the
country’s tax collecting agency. Indeed, the BIR has achieved even greater focus and
seen the optional impact of its programs give to the available resources for the
accomplishment of its mandate. Also, the adaptation of the PGS has gained a high level
of attention and is now considered a necessary condition for honest and good
governance, the central tenet of the Aquino Administration.
The PGS has indeed provided excellent directions for the BIR’s efforts to focus on
efficiency, effectiveness, transparency and accountability thereby enabling us to
enhance our performance and productivity and to contribute even more significantly to
the attainment of the country’s development and nation building initiatives.

*What are the duties and the responsibilities?

What are the Bureau of Internal Revenue (BIR) and What Does It Do?
 The Bureau of Internal Revenue (BIR) is the government body under the
Department of Finance that collects taxes and enforces tax laws. Its powers and
duties include the following: *Reduction and collection of all internal revenue taxes,
fees, and charges *Enforcement of all forfeitures, penalties, and fines connected
therewith, including the execution of judgments in all cases decided in its favor by
the Court of Tax Appeals and the ordinary courts *Administration of supervisory and
 police powers conferred to it by the National Internal Revenue Code and special
laws.

BIR

*What is BIR?
The Bureau of Internal Revenue is an agency of Department of Finance. BIR collects
more than half of the total revenues of the government. Caesar Dulay is the current
Commissioner of BIR.
MANDATE
The Bureau of Internal Revenue shall be under the supervision and control of the
Department of Finance and its powers and duties shall comprehend the assessment
and collection of all national internal revenue taxes, fees, and charges, and the
enforcement of all forfeitures, penalties, and fines connected therewith, including the
execution of judgments in all cases decided in its favor by the Court of Tax Appeals and
the ordinary courts. The Bureau shall give effect to and administer the supervisory and
police powers conferred to it by this Code or other laws. (Section 2 of the National
Internal Revenue Code of 1997)

MISSION
We collect taxes through just enforcement of tax laws for nation-building and the
upliftment of the lives of Filipinos

VISION The Bureau of Internal Revenue is an institution of service excellence and

integrity.

GUIDING PRINCIPLE "Service Excellence with Integrity and Professionalism"

*What are the policies that govern BIR?

National Tax Law

I. 1987 Constitution

The 1987 Philippine Constitution sets limitations on the exercise of the power to tax.
The rule of taxation shall be uniform and equitable.
 All money collected on any tax levied for a special purpose shall be treated as a
special fund and paid out for such purpose only.
 The Congress may, by law, authorize the President to fix within specified limits, and
subject to such limitations and restriction
 The Supreme Court shall have the power to review, revise, reverse, modify or
affirm on appeal or certiorari, as the law or the Rules of Court may provide, final
judgments and orders of lower courts
 Tax exemptions are limited to those granted by law

II. Laws

The basic source of Philippine tax law is the National Internal Revenue Law, which
codifies all tax provisions, the latest of which is embodied in Republic Act No. 8424
(“The Tax Reform Act of 1997”).

III. Periodicals

Periodicals on Philippine tax law are the:

(1) Philippine Revenue Service (copies available in the BIR Library), published by the
BIR from 1969-1980;
(2) Philippine Revenue Journal (copies available in the BIR Library) which was both
published by the Bureau of Internal Revenue from 1969 to 2000; and
(3) the Tax Monthly, published by the National Tax Research Center (NTRC) (copies
available in the BIR Library and the NTRC).

VIII. Local Government Tax Law

Local taxes may be imposed, as the Constitution grants, to each local government unit,
the power to create its own sources of revenues and to levy taxes, fees, and charges
which shall accrue to the local governments.

*How was it created/organized?

In the early American regime from the period 1898 to 1901, the country was ruled by
American military governors. In 1902, the first civil government was established under
William H. Taft. However, it was only during the term of second civil governor Luke E.
Wright that the Bureau of Internal Revenue (BIR) was created through the passage of
Reorganization Act No. 1189 dated July 2, 1904. On August 1, 1904, the BIR was
formally organized and made operational under the Secretary of Finance, Henry Ide
(author of the Internal Revenue Law of 1904), with John S. Hord as the first Collector
(Commissioner). The first organization started with 69 employees, which consisted of a
Collector, Vice-Collector, one Chief Clerk, one Law Clerk, one Records Clerk and three
(3) Division Chiefs.

*Where is the BIR reported?

In 2010, the BIR developed a complaint system, serving as an avenue to cater all types
of complaints/concerns, which in turn are being sent to the concerned offices for
resolution. Email facilities and Short Messaging System or SMS were provided to
complement the system. Though, the old system served its purpose, re-engineering for
its utilization and capabilities is much required.
The rebirth of the BIR’s eComplaint System has finally been set for operations. The
enhanced eComplaint system is made simpler, easy to access and user-friendly. The
system handles complaints by mainly logging into the BIR’s website and tapping the
eServices wherein you shall find the eComplaint System.
Within the eComplaint System are sub-components which sets the criteria on specific
types of complaints or concerns, namely:
 eComplaint Home – the homepage describes the system’s background and the set
criteria including its processes for the utilization of the sub-systems;
 eComplaint NO-OR - are complaints for the non-issuance of official
receipts/invoices and matters relative to the issuance of receipts, such as but not
limited to the issuance of Authority to Print Receipts and Cash Register
Machines/Point-of-Sales machines;
 eComplaint DISIPLINA - are complaints and concerns relative to erring BIR
personnel; Code of Conduct – a detailed compilation pertaining to the present laws
and regulations enforced and must be adopted by all BIR personnel;
 eComplaint R.A.T.E. –pertains to complaints related to Tax Evasion and/or Tax
Avoidance;
 eComplaint OTHERS – are complaints specifically provided for other tax-related
matters not within the context of the other sub-system; and
 eComplaint FAQs – are compilations of “frequently ask questions”, lifted from the
complaints raised thru system.

*What is its structure in the government?

The BIR’s journey with the Performance Governance System (PGS) began in CY 2009,
when it was selected to be one of six (6) National Government Agencies chosen to
participate in a landmark Millennium Challenge Corporation (MCC) Compact Eligibility
endeavor to adopt the Performance Governance System.
PGS is a tool translating statements of governance and vision into actionable strategies
and commitments leading to the realization of breakthrough results. Prior to its selection
for this project, the BIR had already embarked on programs to promote transparency
and accountability in the revenue service, in accordance with the recommendations of
the Integrity Development review (IDR) project implemented in 2007.
The introduction to PGS has helped to further promote our commitment to participatory
governance and partnership with our stakeholders, and has witnessed the renewal of
the public’s trust and confidence in the Government, particularly in the BIR as the
country’s tax collecting agency. Indeed, the BIR has achieved even greater focus and
seen the optional impact of its programs give to the available resources for the
accomplishment of its mandate. Also, the adaptation of the PGS has gained a high level
of attention and is now considered a necessary condition for honest and good
governance, the central tenet of the Aquino Administration.
The PGS has indeed provided excellent directions for the BIR’s efforts to focus on
efficiency, effectiveness, transparency and accountability thereby enabling us to
enhance our performance and productivity and to contribute even more significantly to
the attainment of the country’s development and nation building initiatives.

*What are the duties and the responsibilities?

What are the Bureau of Internal Revenue (BIR) and What Does It Do?
 The Bureau of Internal Revenue (BIR) is the government body under the
Department of Finance that collects taxes and enforces tax laws. Its powers and
 duties include the following: *Reduction and collection of all internal revenue taxes,
fees, and charges *Enforcement of all forfeitures, penalties, and fines connected
therewith, including the execution of judgments in all cases decided in its favor by
the Court of Tax Appeals and the ordinary courts *Administration of supervisory and
police powers conferred to it by the National Internal Revenue Code and special
laws.

BIR

*What is BIR?
The Bureau of Internal Revenue is an agency of Department of Finance. BIR collects
more than half of the total revenues of the government. Caesar Dulay is the current
Commissioner of BIR.
MANDATE
The Bureau of Internal Revenue shall be under the supervision and control of the
Department of Finance and its powers and duties shall comprehend the assessment
and collection of all national internal revenue taxes, fees, and charges, and the
enforcement of all forfeitures, penalties, and fines connected therewith, including the
execution of judgments in all cases decided in its favor by the Court of Tax Appeals and
the ordinary courts. The Bureau shall give effect to and administer the supervisory and
police powers conferred to it by this Code or other laws. (Section 2 of the National
Internal Revenue Code of 1997)

MISSION
We collect taxes through just enforcement of tax laws for nation-building and the
upliftment of the lives of Filipinos

VISION The Bureau of Internal Revenue is an institution of service excellence and

integrity.

GUIDING PRINCIPLE "Service Excellence with Integrity and Professionalism"

*What are the policies that govern BIR?

National Tax Law

I. 1987 Constitution

The 1987 Philippine Constitution sets limitations on the exercise of the power to tax.
The rule of taxation shall be uniform and equitable.
 All money collected on any tax levied for a special purpose shall be treated as a
special fund and paid out for such purpose only.
 The Congress may, by law, authorize the President to fix within specified limits, and
 subject to such limitations and restriction
 The Supreme Court shall have the power to review, revise, reverse, modify or
affirm on appeal or certiorari, as the law or the Rules of Court may provide, final
judgments and orders of lower courts
 Tax exemptions are limited to those granted by law

II. Laws

The basic source of Philippine tax law is the National Internal Revenue Law, which
codifies all tax provisions, the latest of which is embodied in Republic Act No. 8424
(“The Tax Reform Act of 1997”).

III. Periodicals

Periodicals on Philippine tax law are the:

(1) Philippine Revenue Service (copies available in the BIR Library), published by the
BIR from 1969-1980;
(2) Philippine Revenue Journal (copies available in the BIR Library) which was both
published by the Bureau of Internal Revenue from 1969 to 2000; and
(3) the Tax Monthly, published by the National Tax Research Center (NTRC) (copies
available in the BIR Library and the NTRC).

VIII. Local Government Tax Law

Local taxes may be imposed, as the Constitution grants, to each local government unit,
the power to create its own sources of revenues and to levy taxes, fees, and charges
which shall accrue to the local governments.

*How was it created/organized?

In the early American regime from the period 1898 to 1901, the country was ruled by
American military governors. In 1902, the first civil government was established under
William H. Taft. However, it was only during the term of second civil governor Luke E.
Wright that the Bureau of Internal Revenue (BIR) was created through the passage of
Reorganization Act No. 1189 dated July 2, 1904. On August 1, 1904, the BIR was
formally organized and made operational under the Secretary of Finance, Henry Ide
(author of the Internal Revenue Law of 1904), with John S. Hord as the first Collector
(Commissioner). The first organization started with 69 employees, which consisted of a
Collector, Vice-Collector, one Chief Clerk, one Law Clerk, one Records Clerk and three
(3) Division Chiefs.

*Where is the BIR reported?

In 2010, the BIR developed a complaint system, serving as an avenue to cater all types
of complaints/concerns, which in turn are being sent to the concerned offices for
resolution. Email facilities and Short Messaging System or SMS were provided to
complement the system. Though, the old system served its purpose, re-engineering for
its utilization and capabilities is much required.
The rebirth of the BIR’s eComplaint System has finally been set for operations. The
enhanced eComplaint system is made simpler, easy to access and user-friendly. The
system handles complaints by mainly logging into the BIR’s website and tapping the
eServices wherein you shall find the eComplaint System.

Within the eComplaint System are sub-components which sets the criteria on specific
types of complaints or concerns, namely:
 eComplaint Home – the homepage describes the system’s background and the set
criteria including its processes for the utilization of the sub-systems;
 eComplaint NO-OR - are complaints for the non-issuance of official
receipts/invoices and matters relative to the issuance of receipts, such as but not
limited to the issuance of Authority to Print Receipts and Cash Register
Machines/Point-of-Sales machines;
 eComplaint DISIPLINA - are complaints and concerns relative to erring BIR
personnel; Code of Conduct – a detailed compilation pertaining to the present laws
and regulations enforced and must be adopted by all BIR personnel;
 eComplaint R.A.T.E. –pertains to complaints related to Tax Evasion and/or Tax
Avoidance;
 eComplaint OTHERS – are complaints specifically provided for other tax-related
matters not within the context of the other sub-system; and
 eComplaint FAQs – are compilations of “frequently ask questions”, lifted from the
complaints raised thru system.

*What is its structure in the government?

The BIR’s journey with the Performance Governance System (PGS) began in CY 2009,
when it was selected to be one of six (6) National Government Agencies chosen to
participate in a landmark Millennium Challenge Corporation (MCC) Compact Eligibility
endeavor to adopt the Performance Governance System.
PGS is a tool translating statements of governance and vision into actionable strategies
and commitments leading to the realization of breakthrough results. Prior to its selection
for this project, the BIR had already embarked on programs to promote transparency
and accountability in the revenue service, in accordance with the recommendations of
the Integrity Development review (IDR) project implemented in 2007.
The introduction to PGS has helped to further promote our commitment to participatory
governance and partnership with our stakeholders, and has witnessed the renewal of
the public’s trust and confidence in the Government, particularly in the BIR as the
country’s tax collecting agency. Indeed, the BIR has achieved even greater focus and
seen the optional impact of its programs give to the available resources for the
accomplishment of its mandate. Also, the adaptation of the PGS has gained a high level
of attention and is now considered a necessary condition for honest and good
governance, the central tenet of the Aquino Administration.
The PGS has indeed provided excellent directions for the BIR’s efforts to focus on
efficiency, effectiveness, transparency and accountability thereby enabling us to
enhance our performance and productivity and to contribute even more significantly to
the attainment of the country’s development and nation building initiatives.
*What are the duties and the responsibilities?
What are the Bureau of Internal Revenue (BIR) and What Does It Do?
 The Bureau of Internal Revenue (BIR) is the government body under the
Department of Finance that collects taxes and enforces tax laws. Its powers and
duties include the following: *Reduction and collection of all internal revenue taxes,
fees, and charges *Enforcement of all forfeitures, penalties, and fines connected
therewith, including the execution of judgments in all cases decided in its favor by
the Court of Tax Appeals and the ordinary courts *Administration of supervisory and
police powers conferred to it by the National Internal Revenue Code and special
laws.

BIR

*What is BIR?
The Bureau of Internal Revenue is an agency of Department of Finance. BIR collects
more than half of the total revenues of the government. Caesar Dulay is the current
Commissioner of BIR.
MANDATE
The Bureau of Internal Revenue shall be under the supervision and control of the
Department of Finance and its powers and duties shall comprehend the assessment
and collection of all national internal revenue taxes, fees, and charges, and the
enforcement of all forfeitures, penalties, and fines connected therewith, including the
execution of judgments in all cases decided in its favor by the Court of Tax Appeals and
the ordinary courts. The Bureau shall give effect to and administer the supervisory and
police powers conferred to it by this Code or other laws. (Section 2 of the National
Internal Revenue Code of 1997)

MISSION
We collect taxes through just enforcement of tax laws for nation-building and the
upliftment of the lives of Filipinos

VISION The Bureau of Internal Revenue is an institution of service excellence and

integrity.

GUIDING PRINCIPLE "Service Excellence with Integrity and Professionalism"

*What are the policies that govern BIR?

National Tax Law

I. 1987 Constitution
The 1987 Philippine Constitution sets limitations on the exercise of the power to tax.
The rule of taxation shall be uniform and equitable.
 All money collected on any tax levied for a special purpose shall be treated as a
special fund and paid out for such purpose only.
 The Congress may, by law, authorize the President to fix within specified limits, and
subject to such limitations and restriction
 The Supreme Court shall have the power to review, revise, reverse, modify or
affirm on appeal or certiorari, as the law or the Rules of Court may provide, final
judgments and orders of lower courts
 Tax exemptions are limited to those granted by law

II. Laws

The basic source of Philippine tax law is the National Internal Revenue Law, which
codifies all tax provisions, the latest of which is embodied in Republic Act No. 8424
(“The Tax Reform Act of 1997”).

III. Periodicals

Periodicals on Philippine tax law are the:

(1) Philippine Revenue Service (copies available in the BIR Library), published by the
BIR from 1969-1980;
(2) Philippine Revenue Journal (copies available in the BIR Library) which was both
published by the Bureau of Internal Revenue from 1969 to 2000; and
(3) the Tax Monthly, published by the National Tax Research Center (NTRC) (copies
available in the BIR Library and the NTRC).

VIII. Local Government Tax Law

Local taxes may be imposed, as the Constitution grants, to each local government unit,
the power to create its own sources of revenues and to levy taxes, fees, and charges
which shall accrue to the local governments.

*How was it created/organized?

In the early American regime from the period 1898 to 1901, the country was ruled by
American military governors. In 1902, the first civil government was established under
William H. Taft. However, it was only during the term of second civil governor Luke E.
Wright that the Bureau of Internal Revenue (BIR) was created through the passage of
Reorganization Act No. 1189 dated July 2, 1904. On August 1, 1904, the BIR was
formally organized and made operational under the Secretary of Finance, Henry Ide
(author of the Internal Revenue Law of 1904), with John S. Hord as the first Collector
(Commissioner). The first organization started with 69 employees, which consisted of a
Collector, Vice-Collector, one Chief Clerk, one Law Clerk, one Records Clerk and three
(3) Division Chiefs.

*Where is the BIR reported?

In 2010, the BIR developed a complaint system, serving as an avenue to cater all types
of complaints/concerns, which in turn are being sent to the concerned offices for
resolution. Email facilities and Short Messaging System or SMS were provided to
complement the system. Though, the old system served its purpose, re-engineering for
its utilization and capabilities is much required.
The rebirth of the BIR’s eComplaint System has finally been set for operations. The
enhanced eComplaint system is made simpler, easy to access and user-friendly. The
system handles complaints by mainly logging into the BIR’s website and tapping the
eServices wherein you shall find the eComplaint System.

Within the eComplaint System are sub-components which sets the criteria on specific
types of complaints or concerns, namely:
 eComplaint Home – the homepage describes the system’s background and the set
criteria including its processes for the utilization of the sub-systems;
 eComplaint NO-OR - are complaints for the non-issuance of official
receipts/invoices and matters relative to the issuance of receipts, such as but not
limited to the issuance of Authority to Print Receipts and Cash Register
Machines/Point-of-Sales machines;
 eComplaint DISIPLINA - are complaints and concerns relative to erring BIR
personnel; Code of Conduct – a detailed compilation pertaining to the present laws
and regulations enforced and must be adopted by all BIR personnel;
 eComplaint R.A.T.E. –pertains to complaints related to Tax Evasion and/or Tax
Avoidance;
 eComplaint OTHERS – are complaints specifically provided for other tax-related
matters not within the context of the other sub-system; and
 eComplaint FAQs – are compilations of “frequently ask questions”, lifted from the
complaints raised thru system.

*What is its structure in the government?

The BIR’s journey with the Performance Governance System (PGS) began in CY 2009,
when it was selected to be one of six (6) National Government Agencies chosen to
participate in a landmark Millennium Challenge Corporation (MCC) Compact Eligibility
endeavor to adopt the Performance Governance System.
PGS is a tool translating statements of governance and vision into actionable strategies
and commitments leading to the realization of breakthrough results. Prior to its selection
for this project, the BIR had already embarked on programs to promote transparency
and accountability in the revenue service, in accordance with the recommendations of
the Integrity Development review (IDR) project implemented in 2007.
The introduction to PGS has helped to further promote our commitment to participatory
governance and partnership with our stakeholders, and has witnessed the renewal of
the public’s trust and confidence in the Government, particularly in the BIR as the
country’s tax collecting agency. Indeed, the BIR has achieved even greater focus and
seen the optional impact of its programs give to the available resources for the
accomplishment of its mandate. Also, the adaptation of the PGS has gained a high level
of attention and is now considered a necessary condition for honest and good
governance, the central tenet of the Aquino Administration.
The PGS has indeed provided excellent directions for the BIR’s efforts to focus on
efficiency, effectiveness, transparency and accountability thereby enabling us to
enhance our performance and productivity and to contribute even more significantly to
the attainment of the country’s development and nation building initiatives.

*What are the duties and the responsibilities?

What are the Bureau of Internal Revenue (BIR) and What Does It Do?
 The Bureau of Internal Revenue (BIR) is the government body under the
Department of Finance that collects taxes and enforces tax laws. Its powers and
duties include the following: *Reduction and collection of all internal revenue taxes,
fees, and charges *Enforcement of all forfeitures, penalties, and fines connected
therewith, including the execution of judgments in all cases decided in its favor by
the Court of Tax Appeals and the ordinary courts *Administration of supervisory and
police powers conferred to it by the National Internal Revenue Code and special
laws.