Collection of Business Tax

Chapter 7
Tax Period LGC SEC. 165

• Unless otherwise provided in the local government code, tax period

of all taxes, fees and charges shall be the CALENDAR YEAR
Manner of Payment LGC SEC. 165

• Taxes, fees and charges may be paid in quarterly installments

Accrual of tax
• January 1 of each year for existing (old) impositions of taxes, fees and
charges
• First day of the quarter next following the effectivity of the ordinance
imposing such new levies or rate for new taxes, fees & charges
Accrual vs. Time of payment
• Accrual refers to when the amount of tax to be paid is determined
• Time of payment means the period of payment without any
surcharges, penalties or interest
• Example: The Community Tax shall accrue on the first day of January
each year, but the time of payment is not later than the last day of
February each year.
Time of payment for all local taxes, fees & charges LGC
SEC. 167

• If provided for in the Local Government Code

➢Last day of February each year for community tax
• If NOT provided for in the Local Government Code
➢Within 20 days of January each year or of each subsequent quarter
• If extended by Sanggunian
➢Only for a period not exceeding 6 months
Penalties on unpaid taxes, fees or charges LGC SEC.
168

• To be imposed by Sanggunian through an ordinance

• Surcharge must not exceed 25% of the amount of taxes, fees &
charges
• Interest must not exceed 2% per month of the unpaid taxes, fees or
charges including surcharges, until the amount is fully paid
• Interest shall not exceed 36 months
Interest on other unpaid revenues LGC SEC. 169

• Not part of local taxes, fees and charges

• Not a voluntary contribution or donation
• No need for ordinance as provided for in the LGC
• Must not exceed 2% of the unpaid amount
• Shall not exceed 36 months
Authority of Treasurer in collection of taxes LGC
SEC. 170

• All local taxes, fees and charges shall be collected by the provincial,
city, municipal or barangay treasurers or their duly authorized
deputies
• The barangay treasurer may be deputized by provincial, city or
municipal treasurer & bond premiums are to be paid by provincial,
city or municipal government
Authority of treasurer in the inspection of books LGC SEC. 171

May be done by the provincial, city, municipal or barangay treasurer

himself:
• For the purpose of ascertaining, assessing & collecting the correct amount of
tax, fee or charge
• Shall be made only during regular business hours
• Shall be made only once for every tax period
• Shall be certified by the examining official & made of record in the books of
accounts of the taxpayer
Authority of treasurer in the inspection of books LGC SEC. 171
…(continued)
If examination is to be done by a deputy, authority must be in writing
specifically stating:
• The name, address and business of the taxpayer whose books, accounts and
records are to be examined
• The date and place of the examination
• The procedure to be conducted in conducting the examination
End