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Availment of Tax Subsidy

1. Applicants file duly documented application.

A. Letter-request; signed by Head of Office or any authorized official, with the following: (a) endorsement from the Department/Office to which the applicant is attached; (b) backgrounder of the applicant (for GOCCs applying for tax subsidy for the first time); (c) details of tax subsidy requirement, by type of taxes and duties and amount (including Statement of Accounts/billings from the concerned revenue collecting agency, if available); (d) income tax return duly filed with the Bureau of Internal Revenue for GOCCs applying for income tax subsidy; (e) detailed list of importations/purchases and their classification, whether these are for regular operations or project-related (backgrounder on the project); (f) justifications for the application; and (g) latest annual/performance (programs/accomplishments) report;

B. Certification that items for which tax subsidy is sought shall be used exclusively in the pursuit of mandated functions, as stated in its charter and/or enabling law or a specified project;

C. Statement under oath of investments and income therefrom; and

D. Financial opinion/endorsement of the Corporate Affairs Group (CAG) of the Department of Finance. The applicant GOCC shall comply with the financial document/information requirements of the CAG for the purpose (e.g. latest financial statements, cash flow, among others).

2. Evaluation of application by the FIRB Secretariat.

3. Application is elevated to the FIRB Technical Committee for its own evaluation and recommendation.

4. Application is elevated to the Board proper for its evaluation and decision.

5. GOCC receives FIRB Resolution and Certificate of Entitlement to Subsidy (CES) from the FIRB Secretariat.

6. GOCC brings FIRB Resolution and CES to the Bureau of Internal Revenue (BIR) and/or the Bureau of Customs (BOC).

7. The BIR and/or BOC prepares Tax Compliance Certificate/Statement of Accounts (usually on a quarterly basis).

8. GOCC requests the Department of Budget and Management for a Special Allotment Release Order (SARO) based on its accounts with the BIR and/or the BOC.

A. The DBM issues to the GOCC, through the Bureau of Treasury, the pertinent SARO.
B. The DBM informs the BIR and/or the BOC on SARO issued by it.
C. The BTr records the release, the allotment and incurrence of obligation.
D. The amount of SARO is recorded both as an income and expense.

tax subsidy process

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