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BIR intensifies distraint of properties

BIR intensifies collection through distraint, garnishment or levy of properties (Revenue Memorandum Order Nos. 30-2007 and 39-2007)

In order to raise additional revenues to meet its revenue goal, the BIR Commissioner, in RMO 30-07, ordered the intensified issuance of Warrants of Distraint / Levy and /or Garnishment on all delinquent accounts.

In RMO 39-07, the Commissioner further specified that the warrants should be issued and served –

  1. upon issuance by the Commissioner or Regional Director of the final decision on the disputed assessment against the taxpayer, or
  2. upon issuance by the Court of Tax Appeals of its decision upholding the assessment.

Even the filing of a timely appeal to the CTA cannot suspend the payment, levy, distraint and/or sale of any property of the taxpayer for the satisfaction of the tax liability.  Only an order issued by the CTA can suspend its enforcement and no Court (except the CTA) can grant an injunction to restrain the collection.

While there are legal issues being raised against this RMO, the BIR is deemed in authority to enforce it unless it is invalidated by the courts.

Hence, in case your company is issued such a warrant, make sure that the warrant was valid and signed by the proper authority.  There are legal processes that will govern your actions and you should therefore consult with your legal counsel or tax lawyer.

P&A Tax Alerts are intended to keep our clients up to date with  significant tax developments.  We welcome your suggestions and feedback so that the Tax Alerts may be even more useful to you.  If you have comments, or if you would require assistance, or if you would like to be included in our mailing list,   please contact our Tax Knowledge Center:

-   Lina Figueroa at  T: 887-9458

-   Senen Quizon at T:  887-9471