A GROUP of Japanese firms has renewed calls, this time to the new administration, for the speedy release of about P14 billion worth of tax refunds, saying the unresolved issue has caused them cash flow problems and is turning off potential investors.
The 14 firms concerned, some in manufacturing, that are operating outside of the tax-free economic zones are seeking to be paid soon and in cash after waiting for four years, Japan Chamber of Commerce and Industry of the Philippines Vice-President Nobuo Fujii told reporters yesterday.
The Bureau of Internal Revenue (BIR), for its part, said tax credit certificates (TCC) will have to be issued in lieu of cash, since Congress will otherwise first have to allocate the funds for the tax refund.
"Last month, we started talking with the new administration. We reminded them to please do it fast...and pay cash," Mr. Fujii said.
These firms are eligible for refund on value-added tax and import duty payments, since they had registered with the Board of Investments for incentives, Mr. Fujii said.
"The Finance department said they will consider and concentrate [on the matter]," he said.
"Cash flow is affected too much."
This is unfortunate, Mr. Fujii said, as the Philippines should already be positioning itself as an alternative investment site as rising wages in China and its tense relations with Japan are prodding Japanese firms to consider relocation.
But BIR Commissioner Kim S. Jacinto-Henares said the Japanese firms concerned may have to settle for TCCs.
"We issue TCC first..." Ms. Jacinto-Henares said in a phone interview. "It’s not a question of whether we are amenable [to paying in cash]. It’s whether the law allows it. The law requires Congress to appropriate funds first [for the refund]." -- Jessica Anne D. Hermosa
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