BIR to raise taxes on stock market transactions
The Bureau of Internal Revenue will start imposing higher taxes on sales of stock of listed companies with a public float of less than 20 percent.
BIR Commissioner Kim Jacinto Henares informed the Securities and Exchange Commission in a letter that the revenue-collecting agency would strictly impose the final tax of 5 percent on net capital gains from the sale of up to P100,000 worth of stocks or 10 percent for the sale of over P100,000 for publicly listed companies that fail to meet the 20 percent public ownership requirement.
“It is the position of the BIR that for taxation purposes [that] listed companies should continually maintain, if not surpass, their initial public offering requirement to continually enjoy the preferential tax rate of 1/2 of 1 percent of gross selling price of gross value on money on disposal by stockholders of publicly listed shares through the exchange,” Henares said.
“It is the view of the BIR that failure to do so exposes stockholders to the usual 5 percent/10 percent capital gains as these listed companies are technically no longer compliant with their public ownership status [and are] thus deemed no longer publicly listed company for taxation purposes,” Henares added.
The BIR said the public float of listed companies should between 10 percent and 33 percent, depending on market capitalization, in order to qualify as a publicly listed company.
The BIR currently imposes a transfer tax of 0.5 percent from the sale of stock of listed companies, which are also exempted from documentary stamp tax.
The SEC earlier approved the implementation of the 10-percent minimum public ownership requirement among listed companies.
The SEC said it gave listed companies with public float of less than 10 percent within the year to widen their public float to avoid penalties and possible delisting.
There are 40 listed companies that are not compliant with the minimum public ownership.
Among the listed companies with public ownership currently less than 10 percent are government-owned PNOC-Exploration Corp., Eton Properties Philippines Inc., Metro Pacific Tollways Corp., San Miguel Purefoods Co. Inc., Petron Corp., Atok-Big Wedge Co. and Alphaland Corp.
They also include Polar Property Holdings Corp., PLDT Communications and Energy Ventures Inc., Makati Finance Corp., EasyCall Communications Philippines Inc., Republic Cement Corp., Manchester International Holdings Inc., United Paragon Mining Corp., Aboitiz Transport System Corp., Euro-Med Laboratories Philippines Inc. and Keppel Philippines Marine Inc.
Top