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DOF extends deadline of tax payments, other charges imposed by LGUs

The Department of Finance (DOF) has issued a circular extending to December 19, 2020 the payment of all local taxes, fees and charges imposed by local government units (LGUs) with deadlines falling on or after September 14 this year, in compliance with the provisions of Republic Act (RA) No. 11494 or the Bayanihan to Recover As One Act (Bayanihan 2). 

Under Department Circular (DC) No. 003-2020 issued by Finance Secretary Carlos Dominguez III, the counting of the period within which to pay local taxes, fees and charges are also suspended until Dec. 19, 2020, including the period for the redemption of real properties sold or forfeited at public auction. 

“In the event that an LGU had already extended the deadlines prior to the effectivity of RA 11494, such deadlines, if earlier than 19 December 2020, shall be deemed modified with the period set forth herein. Any further extension of deadlines beyond 19 December 2020 shall be authorized in accordance with the provision of RA No. 7160,” the DC states. 

RA 7160 is the Local Government Code.

As a result of the mandatory extension of these payment limits, no interest, surcharge or any form of penalty shall be applied on any local tax, fee or charge accruing on or due and demandable during the period covering such deadlines, the DC also states. 

As for local tax delinquencies prior to the effectivity of Bayanihan 2 on Sept. 15, all payments shall be due and demandable upon the expiration of the Dec. 19 deadline. 

All applicable interests, penalties and surcharges will begin to run again, if due and demandable, after the lapse of the effectivity of Bayanihan 2 on Dec. 19, the DC said.

The DC was issued by Dominguez to provide guidelines on the uniform implementation by LGUs of Section 4 (tt) of  the Bayanihan 2 Law, which provides for stretching the statutory deadlines and timelines for the filing and submission of any document, the payment of taxes, fees and other charges required by law, and the grant of any benefit. 

This provision under Bayanihan 2 aims to ease the burden on individuals and enterprises affected by the severe disruption of economic activities resulting from the stringent community quarantines that the national and local governments have imposed to curb the spread of COVID-19. 

Under DC 003-2020, the local treasurers were instructed to coordinate with LGU officials to actively inform taxpayers of these mandatory extensions and to reconfigure the electronic information systems used by local governments for the assessment and computation of such local taxes, fees and charges covered by the Circular. 

Local treasurers were also directed to defer activities related to administrative or judicial action for the enforcement and/or collection of local taxes, fees or charges until the lapse of the effectivity of the Bayanihan 2 Law. 

They were likewise directed to enable the use of electronic or non face-to-face payment facilities so that taxpayers who will still opt to pay early  may be continuously accommodated by the LGU to ensure physical distancing. 

The LGU treasurers were ordered to work on the immediate adoption of these digital facilities. 

DC 003-2020 directed LGU treasurers to advise their respective local chief executives on matters concerning the grant of further incentives and/or privileges to taxpayers and business establishments, particularly those extending assistance and providing essential services for COVID-19 response. 

It directed the BLGF, meanwhile, to monitor the compliance of all local  treasurers with these directives  and to extend to them the technical assistance they need to implement this Circular. 

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