Business

DOF voids tax perks of textile companies

DOF voids tax perks of textile companies

MANILA, Philippines — Around P1.2 billion of tax incentives allegedly obtained illegally by several textile firms have been invalidated, according to the Department of Finance (DOF).

The agency said a new set of notices of disallowance (NDs) on the tax credit certificates (TCCs) of six textile firms were issued by the Commission on Audit (COA), so far nullifying P1.195 billion in tax credit issued from 2008 up to 2014.

DOF said among the textile firms that supposedly secured illegal tax credit from the One-Stop Shop Inter-Agency Tax Credit and Duty Drawback Center (OSS) were Capital-Roll Knit Corp., Uni-Glory’s Knitting Corp., Primeknit Manufacturing Corp., Tai-Cheng Integrated Resource Inc., Miskhu Industrial Corp., and Universal Pacific Knitting Mills Inc.

Tax credits were offered as incentives under the Omnibus Investments Code to exporters and manufacturers registered with the Board of Investments (BOI) that paid duties and taxes on the raw materials and supplies used in production.

These allow such firms to refund these duties and taxes and use them to pay other tax liabilities to the government.

These tax credits are issued by the OSS, a composite body managed by the DOF, Bureau of Internal Revenue (BIR), Bureau of Customs (BOC), and the BOI.

It was found out, however, that the OSS had issued TCCs to either ghost exporters or real companies that were not exporting.