House OKS ease of paying taxes bill on third and final reading

THE House of Representatives on Wednesday approved on third and final reading the proposed Ease of Paying Taxes (EOPT) Act, which seeks to modernize tax administration and improve tax compliance in the country.

Voting 193 affirmative, 0 negative and no abstention, lawmakers approved House Bill 8942 to simplify tax compliance procedures by segmenting taxpayers and better tailoring processes, enhance the portability of tax transactions, and legislate the Taxpayer’s Bill of Rights.

The bill will now be transmitted to the Senate for its own deliberations.

The measure institutionalizes a simplified process of filing of tax returns for small taxpayers and, thus, facilitates their compliance with tax rules and regulations.

The bill also creates a Taxpayer’s Advocate office in the Bureau of Internal Revenue (BIR) to act as the taxpayer’s recourse for issues with the bureau.

Key benefits of the EOPT include allowing taxpayers to file for a Tax Identification Number (TIN) offsite, removal of the required annual BIR registration, and harmonization of venue rules to allow fully online filings with the bureau.

The bill introduces a “medium” taxpayer classification and streamlined procedures for the “small” taxpayers.

It also cancels the BIR registration requirement, which will also cancel automatic BIR audits. The BIR shall decide whether or not to audit based on risk assessment evaluations.

The measure removes the need to secure authority to print from the BIR before hard copy invoices can be issued. The business style requirement will also be removed.

The bill ensures taxpayer’s rights as the guiding principle in formulating and implementing tax policies and regulations. The taxpayer’s right to have the cost of compliance respected whenever tax rules are prepared and enforced shall be considered whenever the BIR prescribes new rules on the filing and payment of taxes.

It also removes the required annual taxpayer registration fee payment of P500.

Earlier this month, the Joint Foreign Chambers called for the passage of the measure.