Gov’t rejects tax credits for erring textile firms

THE GOVERNMENT took back P153.13 million in tax credits granted to textile firms due to their engagements in illegal transactions, the Department of Finance (DoF) said on Friday.

“The four errant textile companies had illegally acquired the TCCs (tax credit certificates) over a four-year period from 2008 to 2012,” the agency said in a statement on Friday.

The Commission on Audit (CoA) issued notices of disallowances to Capital-Roll Knit Corp., Uni-Glory’s Knitting Corp., Primeknit Manufacturing Corp. and Tai-Cheng Integrated Resource Inc. The firms were earlier found to have gotten away with P605.98 million in illegal tax perks. This brought their combined tax credit rejections to P759.12 million.

Under Executive Order 226 or the Omnibus Investments Code, tax credits are available to exporters and manufacturers of products registered with the Bureau of Investments. This could be used by exporters that have paid duties and taxes on the raw materials and supplies they used in manufacturing their goods.

Once applications for TCCs are approved, firms can get refunds on duties paid.

However, TCCs are sometimes issued to ghost exporters and bonafide companies that do not deserve the tax credits.

Aside from the four business establishments, two other firms had their TCCs worth P59.5 million junked by the CoA.

“Several officials and employees of the DoF, BoI (Board of Investments), Bureau of Customs (BoC) and OSS (One-Stop Shop Inter-Agency Tax Credit and Duty Drawback Center) who were responsible for processing and approving the illegal TCCs in the past, as well as their recipients and claimants from the four companies, were held liable by COA in various instances when the TCCs were issued,” the DoF said. — LWTN

Must Read

Asia stocks fluctuate as virus cases offset vaccine roll-out hopes

0
          HONG KONG - Asian markets swung Monday as hopes that vaccines will soon be rolled out played against concerns over a pick-up in virus...