BIR: Stores can raise prices even without tax reform law implementing rules

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Metro Manila (CNN Philippines, January 11) — Internal Revenue Commissioner Caesar Dulay said stores can raise prices even as the agency has yet to release the implementing rules and regulations (IRR) of the tax reform law, which took effect on January 1.

"January 1, 2018. The law is the law. It has to be complied with," he said in a Thursday forum, where the agency consulted the public on the drafting the law's IRR.

Meanwhile, Trade Secretary Ramon Lopez said on Thursday that stores can adjust prices, but warned that owners will be held liable should they engage in profiteering.

The tax reform law hikes taxes on coal, fuel, liquefied petroleum gas and sugary beverages.

Read: Lower income tax, higher taxes on sugar, petroleum, tobacco products by 2018

Lopez said on January 4 that the law will have "minimal" impact on food prices.

Read: Trade chief: Effect of tax reform on basic goods' prices 'minimal'

During the Bureau of Internal Revenue (BIR) forum, employees and accountants expressed concern on computing income tax and exemptions, with some wondering if the lower income tax rates are now effective.

The measure exempts those earning up to ₱250,000 annually, including self-employed individuals, from paying income tax. The bill also exempts 13th month pay and bonuses amounting to ₱90,000 from taxation.

The new scheme will also lower income tax rates for those earning ₱2 million and below.

Dulay said the law is clear: incomes should be subject to the new tax rates or else employers risk facing penalties.

"We have published the RMC (Revised Memorandum Circular) and they should have checked that," he said. "They know the rates."

BIR Spokesperson Marissa Cabreros also asked employers to tell their employees about delays in carrying out the new tax rates and apply the adjustments accordingly.

The BIR will finalize the law's implementing rules and regulations (IRR) after consultations wrap up on Friday.

Dulay said they plan to submit the draft IRR to the Finance Department for approval by the end of the month.