GRANTING A TAX AMNESTY ON UNTAXED INCOME AND/OR WEALTH EARNED OR ACQUIRED DURING THE TAXABLE YEARS 1974 TO 1980 AND REQUIRING THE FILING OF THE STATEMENT OF ASSETS, LIABILITIES, AND NET WORTH.

• Number: Presidential Decree No. 1840
• Sections: 13

Preamble

WHEREAS, on account of the relatively complicated manner of

computing the tax to be paid under Presidential Decree No. 1740, only a limited

number of taxpayers have availed of the benefits of the said Decree despite the

grant of immunity from investigation;

WHEREAS, to maximize the availment of tax amnesty and invite

the voluntary disclosure of untaxed income or wealth and encourage the

investment of such funds in productive enterprises, there is a need to simplify

the determination of the amnesty tax to be paid; and

WHEREAS, it is the desire to afford full opportunity for

individual taxpayers to come within the fold of the tax reforms and to provide

them with a clean start for the adoption of the gross income taxation

scheme.

NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the

Philippines, by virtue of the powers in me vested by the Constitution, do hereby

decree and order that:

Section 1 Coverage.

SECTION 1. Coverage. — In case of voluntary

disclosure of previously untaxed income and/or wealth such as earnings,

receipts, gifts, bequests or any other acquisition from any source whatsoever,

realized here or abroad, by any individual taxpayer, which are taxable under the

National Internal Revenue Code, as amended, the assessment and collection of all

internal revenue taxes, including the increments or penalties on account of

non-payment as well as all civil, criminal or administrative liabilities arising

from or incident thereto under the National Internal Revenue Code, are hereby

condoned provided that the individual taxpayer shall pay:

a tax of twenty per centum (20%) on such previously untaxed income or wealth

in the case of resident citizens or resident aliens; or

a tax of two per centum (2%) on such previously untaxed income converted in

U.S. Dollars derived from sources abroad, in the case of non-resident

citizens.

Those who have already availed of the benefits granted under Presidential

Decree No. 1740 and its implementing regulations may also take advantage of the

benefits provided for under this Decree and shall be allowed to credit

any amount previously paid under Presidential Decree No. 1740 against the

amnesty tax payable under this Decree.

Section 2 Conditions for Immunity.

SEC. 2. Conditions for Immunity. — The immunity

granted under Section one of this Decree shall apply only under the following

conditions:

Such previously untaxed income and/or wealth must have been earned or

realized in any of the years 1974 to 1980;

The taxpayer must file an amnesty return on or before November 30, 1981, and

fully pay the tax due thereon;

The amnesty tax paid by the taxpayer under this Decree shall not be less

than P1,000.00 per taxable year;

The taxpayer must file a statement of assets, liabilities and net worth as

of December 31, 1980, as required under Section 6 hereof.

Section 3 Cases Not Covered by this Decree.

SEC. 3. Cases Not Covered by this Decree. — The tax

amnesty granted herein shall not apply to the following cases:

Criminal cases already filed in Court or with the Fiscal's Office on or

before September 17, 1980;

Internal revenue tax cases involving civil liability which are the subject

of a pending criminal action in the Fiscal's Office or the Court prior to

September 17, 1980;

Withholding tax at source liabilities provided for under Sections

53, 54 and Chapter XI of Title II of the National Internal Revenue Code; and

transfer tax cases under Title III of the same Code for which no certificate of

clearance has as yet been issued; and

Deficiency internal revenue taxes assessed on or before September 17, 1980.

For this purpose, the date of the assessment notice shall be deemed to be the

date of assessment of the deficiency tax.

Section 4 Time Manner and Place of Filing.

SEC. 4. Time Manner and Place of Filing. — The tax

amnesty return shall be filed in the prescribed form with the Office of the

Regional Director, Revenue District Officer, Collection Agent or the authorized

Municipal Treasurer designated as collection officer of the Bureau of Internal

Revenue where the taxpayer has his legal residence or place of business in the

Philippines, then with the Commissioner of Internal Revenue, on or before

November 30, 1981. In the case of Filipino citizens residing abroad, the tax

amnesty return shall be filed with the nearest Philippine Embassy or Consulate

abroad or with the Office of the Commissioner of Internal Revenue.

The amnesty return must show the amount of untaxed income and/or wealth for

each year and the corresponding tax due thereon.

Section 5 Payment of Tax on Installment.

SEC. 5. Payment of Tax on Installment. — The tax

due as disclosed by the taxpayer in his return must be paid at the time of the

filing thereof. If the total tax due exceeds P50,000, the same shall be paid in

accordance with the following schedule:

If the amount due exceeds P50,000 but does not exceed P100,000, the tax may

be paid in two equal installments, the first installment to be paid upon the

filing of the return and the second installment, on or before January 31, 1982;

If the amount due exceeds P100,000, the tax may be paid in three equal

installments as follows:

i) The first installment shall be paid upon the filing of the return;

ii)

The second installment shall be paid on or before January 31, 1982; and

iii)

The third installment shall be paid on or before March 31, 1982.

In meritorious cases where the total amount due exceeds P300,000.00, the

Commissioner of Internal Revenue of the Revenue Regional Director may, upon

proper application, allow the taxpayer to pay the P300,000.00 in accordance with

the immediately preceding schedule and the amount in excess thereof in equal

monthly installments beginning June 30, 1982, up to but not later than September

30, 1982.

If any installment payment is not paid on the due date of said installment,

the whole unpaid amount will become due and demandable and shall be subject to

interest and penalties imposed under the Tax Code. The corresponding letter of

demand and assessment notice shall immediately be issued for the collection of

the amount due and increments thereon.

Section 6 Filing of Net Worth Statement.

SEC. 6. Filing of Net Worth Statement. — (a)

Persons required to make a statement of net worth.— All individuals, whether a

citizen residing in the Philippines or abroad or any alien residing in the

Philippines owning assets and/or properties amounting to P50,000 or more as of

December 31, 1980 and who is not required to file a statement of assets,

liabilities and net worth under Republic Act No. 3019, as amended by

Presidential Decree Nos. 677 and 1288 shall file a sworn statement of assets,

liabilities and net worth as of December 31, 1980.

b) When and where to file. — The statement of assets, liabilities

and net worth as of December 31, 1980 shall be filed in the priscribed form not

later than November 30, 1981, with the Commissioner of Internal Revenue,

Regional Director, Revenue District Officer, Collection Agent or the authorized

Municipal Treasurer who has been designated as collection has his legal

residence or place of business in the Philippines, then with the Commissioner of

Internal Revenue. In the case of non-resident citizens, they may file their

statement with the nearest consular office in the foreign country where they

reside or may file the statement directly with the Commissioner of Internal

Revenue.

Section 7 Valuation.

SEC. 7. Valuation. — (a) Assets. — The

value of the assets, whether real or personal shall be the cost thereof if

acquired by purchase or the fair market value as of the date of acquisition if

acquired by exchange or by gratuitous title. If the property is used in trade or

business, the depreciated value as of December 31, 1980 shall be included in the

statement. In the case of assets already declared in the statement of assets and

liabilities filed by the taxpayer pursuant to Presidential Decree No. 379 or

631, the value of such assets as declared therein shall be used.

(b) Liabilities. — Only liabilities and enforceable obligations

reducible in sums of money as of December 31, 1980 shall be included in the

statement.

Section 8 Penalties for failure to file statement or rendering false or fraudulent statement.

SEC. 8. Penalties for failure to file statement or

rendering false or fraudulent statement. — Any individual required to file

the statement of assets, liabilities and net worth under this Decree who

knowingly makes a false declaration or who deliberately fails to comply with any

of the provisions hereof, shall upon conviction pay a fine of not less than Five

thousand Pesos (P5,000.00) and imprisonment of not less than two (2) years.

Section 9 Unlawful divulgence of information.

SEC. 9. Unlawful divulgence of information. — (a)

No information contain in the statement herein required shall be published

except in the form of tabulations and summaries having no specific reference to

the individual filing the statement.

(b) Except for internal revenue tax purposes, it shall be unlawful for any

officer or employee of the Bureau of Internal Revenue or any government entity

having knowledge of such declaration of assets, liabilities and net worth to

disclose to any person any information relative to such declaration and any

violation hereof shall subject such offender to a fine in the amount of not less

than Five thousand pesos or imprisonment for not less than two years, or both,

and shall be summarily dismissed from the service for cause.

Section 10

SEC. 10. The Ministry of Finance shall, upon the

recommendation of the Commissioner of Internal Revenue, promulgate the necessary

rules and regulations for the effective implementation of the provisions of this

Decree.

Section 11 Repealing Clause.

SEC. 11. Repealing Clause. — Any provision of

Presidential Decree No. 1740 and all other issuances pertinent thereto which are

inconsistent herewith are hereby repealed or modified accordingly;

Provided That, those who have already filed the statement of assets

liabilities and net worth prescribed under Presidential Decree No. 1740 need not

file the statement required under this Decree.

Section 12 Effectively.

SEC. 12. Effectively. — This Decree shall take

effect upon approval.

Done in the City of Manila, this 19th day of September, 1981.

(Sgd.) FERDINAND E. MARCOS

President of the

Philippines

By the President:

(Sgd.) JUAN C. TUVERA

Presidential Executive

Assistant