4/7/2021
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Co. Pte. Ltd. (APL), and Maersk-Filipinas, Inc. (Maersk) v. Commissioner of Internal
Revenue." The case was raffled to RTC-Branch 98, Quezon City, and docketed as Civil
Case No. Q-09-64241.[5]
Petitioners prayed that the trial court: 1) issue a writ of preliminary injunction enjoining
the then BIR Commissioner and her representatives, agents, or those acting under her
instructions or on her behalf from implementing, enforcing, or acting pursuant to or on
the basis of the challenged provisions of RMC 31-2008; and 2) render judgment
declaring these challenged provisions void.[6]
According to petitioners, RMC 31-2008 was void insofar as it imposed regular tax rate
of thirty percent (30%) and twelve percent (12%) VAT on the demurrage and detention
fees collected by international shipping carriers from shippers or consignees for delay in
the return of containers, on the domestic portion of services to persons engaged in
international shipping operations, and on commission income received by local shipping
agents from international shipping carriers or in connection with inbound shipments.
By Order[7] dated May 18, 2012, Branch 98 held that international carriers were not
subject to income tax under Section 28 (A)(1)(3b)[8] of the NIRC. Too, demurrage fees
were not considered income derived from other or separate business of the
international carrier. Being incidental to the trade or business of the international
carrier, demurrage fees should instead form part of the Gross Philippine Billings (GPB)
subject to 2.5% tax under Section 28. Further the law did not expressly impose 12%
VAT on the domestic portion of the services rendered by international carriers.[9] Thus:
WHEREFORE, premises considered, and pursuant to Rule 35 of the 1997
Rules of Civil Procedure, the Court grants the motion for summary judgment
and declares as INVALID, the pertinent portions of Revenue Memorandum
Circular No. 31-2008, insofar as the latter subjects the: a) demurrage and
detention fees to the regular corporate income tax rate under Section 28(A)
(1) and 12% VAT; b) domestic portion of the services rendered to persons
engaged in international shipping operation to 12% VAT; and c) commission
income or fees received by local shipping agents from international shipping
carriers for the latter's inbound freights/fares to 12% VAT, for being contrary
to Section 28 (A)(1), and (3) and Section 108 (B)(4) of the National Internal
Revenue Code of 1997, as amended.
SO ORDERED.[10]
The Order became final and executory as of June 16, 2012.[11]
On March 7, 2013, Republic Act No. 10378[12] (RA 10378) was enacted, amending
Section 28 (A)(3)(a) of the NIRC. The provision now reads:
SEC. 28. Rates of Income Tax on Foreign Corporations.—
(A) Tax on Resident Foreign Corporations. —
(1) xxx
(2) xxx
https://elibrary.judiciary.gov.ph/thebookshelf/showdocsfriendly/1/65912
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