ABS-CBNnews.com | 01/17/2013 5:29 PM
MANILA, Philippines - A regional trial court junked the application of distilled spirits companies for a temporary restraining order on the implementation of the sin tax reform law.
A statement issued by the Department of Finance said that a court order was issued by the NCR Regional Trial Court on Wednesday, denying the application of the
Distilled Spirits Association of the Philippines for a TRO on the sin tax revenue regulations.
The court denied the TRO on two grounds:
The RTC also that no court has an authority to grant an injunction to restrain the collection of taxes, citing Section 218 of the National Internal Revenue Code (NIRC).
The court said that a TRO may only be issued "in the existence of a clear and unmistakable right to be protected, and an urgent necessity to prevent serious damages."
The DSAP had claimed Revenue Regulations No. 17-2012, which contain the implementing rules of the sin tax reform law, constitutes "double taxation." It also said the new law violates the NIRC and the 1987 Constitution, and would "damage the local distilled spirits industry."
"The BIR stands by its position which the court has affirmed. The petitioners will not incur irreparable damages if the law is implemented," BIR Commissioner Kim Jacinto-Henares said.
The petitioners in the case are the DSAP, Destileria Limtuaco & Company, Emperador Distillers, and Tanduay Distillers.
Hearings on the preliminary injunction will be conducted next month.
The sin tax reform law, which imposes higher excise taxes on alcohol and tobacco products, took effect on January 1.