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Pilipinas Shell Petroleum Corp. will pay P3.49 billion to the Bureau of Customs under protest for its importation of alkylate
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The amount represents alleged excise taxes and VAT on fuel blending components used in PSPC’s refinery for the years 2014-2020
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PSPC said the payment is being made pursuant to the demand letter of BOC-Port of Batangas after the Supreme Court dissolved the temporary restraining order previously issued
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PSPC said the case of whether alkylate is subject to excise tax or not has yet to be decided by the courts
Pilipinas Shell Petroleum Corp. (PSPC) will remit P3.49 billion to the Bureau of Customs (BOC) as payment under protest for its importation of alkylate.
“Taking into consideration the current economic challenges of the country as well as ensuring continued operations, uninterrupted imported fuel supply and welfare of our motoring public and consumers, [PSPC] will remit a total of Php3.49bln, under protest, representing alleged excise taxes and VAT [value-added tax] on fuel blending components used in our refinery for years 2014-2020 to the BOC,” PSPC said in a regulatory disclosure.
The petroleum company said BOC has recognized its intent to pay under protest, following the demand letter from BOC-Port of Batangas after the Supreme Court (SC) dissolved the temporary restraining order (TRO) previously issued as a result of the matter being remanded to the Court of Tax Appeals (CTA).
PSPC said the payment will allow the company “to continue to provide to our customers and to the general public who rely on our products and mindful of the thousands of Filipinos whose livelihood depends on our ability to maintain our operations.”
In a decision written by Senior Associate Justice Estela Perlas-Bernabe promulgated March 15 but made public only on July 8, the SC lifted the TRO issued in July 2014 that barred the government from imposing taxes on importation of alkylate, a gasoline blending stock.
The case originated from a CTA case where PSPC questioned the validity of documents from the BOC-Port of Batangas collector compelling the company to pay P1.99 billion in deficiency excise taxes, inclusive of interest and penalties, for its alkylate importations between January 2010 and June 2012.
In a concurring and dissenting opinion, Associate Justice Amy Lazaro-Javier noted that alkylate is subject to excise tax under Section 148 of the National Internal Revenue Code, as amended.
The SC likewise affirmed the power of the CTA to issue a temporary restraining order/writ of preliminary injunction (TRO/WPI) to stop the government from collecting excise taxes on PSPC’s subsequent alkylate importations.
Accordingly, the SC remanded the case to the CTA to determine if PSPC is entitled to a TRO/WPI.
PSPC said the case of whether alkylate is subject to excise tax has yet to be decided by the courts.
