The Bureau of Internal Revenue (BIR) is running after tricycle operators, sari-sari store and flower shop owners, as part of its drive to strengthen its tax evasion campaign.
The Revenue Memorandum Circular (RMC) 7-2014) issued by the central office recently requires the owners of sari-sari stores, ‘ carinderias’, operators of single unit tricycles, as well as farmers and fishermen to register with the BIR.
These micro entrepreneurs are also required to submit reports on earnings and issue BIR-registered receipts and sales invoices.
Furthermore, the marginal income earners or (MIEs) will be exempted from paying any percentage tax and business taxes like the value-added tax (VAT).
They are also exempted from paying the annual registration fee.
MIEs are defined in the circular as individuals who are self-employed and earning not more than P100,000 in any given 12-month period in which incomes are considered mainly for subsistence.
MIEs should register and maintain books of accounts (e.g. two-column journal or other simplified books for daily expenses and revenue) and file the Annual Income Tax Return using BIR Form 1701 and pay the income tax due.
Minimal documentary requirements such as sworn statement of income for the year and an NSO-certified or local civil registry birth certificate are needed to register as MIE.
“The tax exemption certificate or ruling must explicitly recognize the grant of exemption, as well as the corresponding exemption from withholding tax,” the BIR said in the circular.
Failure of the taxpayer to present the said tax exemption certificate shall subject him to the payment of appropriate withholding taxes due on the transaction and will require him to pay their income tax dues in full. (with reports from PDI)/IMT.