Legislative Information Tracking and Administration System

WHEREAS, on 16 July 2009, the Bureau of Internal Revenue (“BIR”) issued a Letter of Authority (“LOA”) No. 00046422 against the City Government of San Juan for the examination of books of accounts and other accounting records for the alleged tax deficiencies for the Taxable Year 2008, during the administration of then City Mayor Joseph Victor G. Ejercito;

WHEREAS, on 10 November 2015, upon failure of the past administrations to submit documents and to contest or explain the validity of tax deficiencies, the BIR issued a Preliminary Assessment Notice (“PAN”) collecting a total amount of One Hundred Ninety-Five Million Seven Hundred Sixty-Nine Thousand Nine Hundred Sixty Pesos and Twenty Centavos (195,769,960.20) from the basic tax deficiencies of Sixty-Five Million Nine Hundred Fifty-Four Thousand Two Hundred Forty-Seven Pesos and Ninety Centavos (Php65,954,247.90);

WHEREAS, again, for the failure of the City Government to dispute and contest the tax deficiencies, a Formal Letter of Demand (“FLD”) was released by the BIR on 01 April 2016 for the total payment of Two Hundred Two Million Three Hundred Sixteen Thousand One Hundred Ninety-Two Pesos and Forty-Two Centavos (Php202,316,192.42), accumulating surcharge and interest thereon;

WHEREAS, on 29 May 2020, a Final Decision on Disputed Assessment (“FDDA”) and thereafter, a Warrant of Distraint and/or Levy (“WDL”) on 04 May 2022 was signed by the Honorable Clavelina S. Nacar, Assistant Commissioner, Collection Service of the BIR with the following assessment:

WHEREAS, the issuance of WDL by the BIR would cause disruption and prejudice to the governmental function of the City Government by paralyzing its service to the people of San Juan and withholding the hard earned salaries of the employees of the City;

WHEREAS, the City Mayor, Hon. Francisco Javier M. Zamora, in his utmost desire to fulfill the tax obligations of the past administration and to maintain good standing with the said agency without compromising the continuity of the programs of the city and its assistance to the San Juaneños, including the employees of the City, made effort to settle the obligation by entering into a compromise with the BIR;

WHEREAS, with the effort of the City Mayor, Hon. Francisco Javier M. Zamora, through a series of discussion with the officials of the BIR including the Commissioner of Internal Revenue (“CIR”), Honorable Caesar R. Dulay, an application or proposal was submitted for the payment of basic Tax Deficiency with forty percent (40%) reduction of Income Tax and Value Added Tax amounting to only Forty Million Nine Hundred Ninety-Seven Thousand Nine Hundred Forty-Two Pesos and Seventy-Five Centavos (Php40,997,942.75). This amount originated from Two Hundred Thirty-Five Million Two Hundred Ninety-Three Thousand Three Hundred Sixteen Pesos and Thirty-Eight Centavos (Php235,293,316.38), the total Tax Deficiency with surcharge and interest which was later on negotiated to Sixty-Five Million Nine Hundred Fifty-Four Thousand Two Hundred Forty-Seven Pesos and Ninety Centavos (Php65,954,247.90) representing the basic Tax Deficiency. Hence, a projected eighty percent (80%) discount from the tax liability of the City Government saving almost One Hundred Ninety-Four Million (Php194,000,000.00) from the local fund of the City; and,

WHEREAS, there is a need to settle the obligation incurred by the previous administration to prevent the serving of the WDL and allow the City Mayor, Hon. Francisco Javier M. Zamora, to sign the Application For Compromise Settlement (BIR Form No. 2107) to finally settle and resolve the Deficiency Tax assessment against the City Government of San Juan.

NOW THEREFORE RESOLVED, AS IT IS HEREBY RESOLVED BY THE SANGGUNIANG PANLUNGSOD OF THE CITY OF SAN JUAN, METRO MANILA, BY VIRTUE OF THE POWERS VESTED IN IT BY LAW, IN SESSION DULY ASSEMBLED, to authorize the Honorable City Mayor to sign the Application For Compromise Settlement (BIR Form No. 2107) for and on behalf of the City Government of San Juan to finally settle and resolve the Tax Deficiency Assessment issued against the latter, subject to existing laws, circulars, rules and regulations.

RESOLVED FINALLY, the authority, issuance, and approval hereof is subject to compliance by the City Government with all existing laws, circulars, issuances, COA rules, and regulations on purchases, expenditures, appropriations, and procurement.