10 March 2021
Office of the Taguig City Treasurer
City Government of Taguig
Taguig City Hall, Gen. A Luna St, Taguig,
1637 Metro Manila
Attention:
Atty. J. Voltaire L. Enriquez
OIC- City Treasurer’s Office
Subject:
Letter of Protest against Local Business Tax (LBT)
Assessment for CY 2017
Dear Sir/Madam,
We are writing this letter to formally protest the assessment of business tax for 3RE GENERAL
MERCHANDISE, owned and operated by MR. RUBEN EVANGELISTA (hereinafter referred to as the
Business), in the amount of Forty two thousand nine hundred seventy seven pesos and twenty five
centavos.
It is our opinion that there is an error in the assessment of business tax due from the Business. As
indicated in the 2021 Business Permit (attached as Annex A), there is a deficiency tax assessed in the
amount of Twenty two thousand six hundred seventy three pesos and fifty-one centavos. However,
upon reviewing the documents, it became apparent that this was cause by the assessment made in
2020, which uses the 2018 gross receipts instead of the 2019 gross receipts resulting in deficiency tax.
To note, the amount of Php 4,764,993.10, is the Business’s gross receipts for 2018, as seen in the
Business Permit for 2019 (attached as Annex C) and the same base was used in the 2020 assessment
as seen in the Business Permit for 2020 (attached as Annex B) when in fact, the VAT filings for 2019
were attached as a requirement and the year to date Gross Receipts for November 2019 were already
over Php 5,000,000.00.
Under Section 143 in relation to Section 151 of the Local Government Code (LGC), Taguig City can only
assess and collect LBT based on the taxpayer’s gross sales/receipts of the preceding calendar year. For
this purpose, gross receipts is defined under Section 131 of the LGC, as follows:
“xxx xxx xxx
(n) Gross Sales or Receipts include the total amount of money or its equivalent
representing the contract price, compensation or service fee, including the
amount charged or materials supplied with the services and the deposits or
advance payments actually or constructively received during the taxable quarter
for the services performed or to be performed for another person excluding
discounts if determinable at the time of sales, sales return, excise tax, and valueadded tax (VAT); (Emphasis ours)
xxx xxx xxx”
In addition, Sec. 143 (e) of the LGC provides that the tax to be imposed on
“xxx xxx xxx
(e) contractors and other independent contractors, in accordance with the following
schedule:
With gross receipts for the preceding calendar year in the amount of: (Emphasis ours)
xxx xxx xxx”
In view of the foregoing, the assessment of the local business tax for the Business was not made in
accordance with the provisions of the LGC. Local business tax should be assessed base on the gross
receipts of the preceding calendar year.
Following this, we are of the opinion that we should not be subject to any penalties and surcharges
since the deficiency was not caused by any under declaration on our part. Hence, we respectfully
request that the penalty and surcharges amounting to Php 8,277.63 be waived and applied as a
credit to our next payment.
Lastly, we would like to take note that we paid our first installment of Local Business Tax but the said
payment is now UNDER PROTEST since we are waiting for this matter to be resolved.
Very truly yours,
RUBEN A. EVANGELISTA
Owner
ANNEX A
2021 Business Permit
ANNEX B
2020 Business Permit
ANNEX C
2019 Business Permit