{"id":329733,"date":"2024-10-01T21:57:17","date_gmt":"2024-10-01T13:57:17","guid":{"rendered":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/?p=329733"},"modified":"2024-10-01T21:57:18","modified_gmt":"2024-10-01T13:57:18","slug":"trade-the-news-dmc-wins-p103-68-million-tax-appeal","status":"publish","type":"post","link":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/trade-the-news-dmc-wins-p103-68-million-tax-appeal\/","title":{"rendered":"Trade the News: DMC wins P103.68 million tax appeal"},"content":{"rendered":"\n
Potential Impact of this News<\/strong><\/td>POSITIVE on the stock price<\/strong><\/td><\/tr>
Company<\/strong><\/td>DMCI Holdings, Inc.<\/td><\/tr>
Stock Code<\/strong><\/td>DMC<\/td><\/tr>
Long-term Recommendation on the Stock<\/strong><\/td>Hold<\/td><\/tr>
1-Year Target Price<\/strong><\/td>PHP 11.89<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n
<\/div>\n\n\n\n

The Court of Tax Appeals (CTA) ruled in favor of DMCI Holdings, Inc. (DMC) in the company\u2019s appeal against the Bureau of Internal Revenue (BIR) regarding over P103.68 million in deficiency income tax assessment for 2014, citing erroneous audit calculations and a lack of substantial evidence.<\/p>\n\n\n\n

The tax court\u2019s first division, in a decision publicized on Sept. 23, rejected the BIR\u2019s computation of the company\u2019s taxable income for 2014.<\/p>\n\n\n\n

\u201cFinding that petitioner has no more deficiency income tax liability for [the] calendar year 2014, the Formal Letter of Demand dated 01 September 2020 and the Final Decision on Disputed Assessment dated 27 December 2021 are canceled and set aside,\u201d the 35-page ruling penned by Associate Justice Jean Marie A. Bacorro-Villena read.<\/p>\n\n\n\n

DMCI initially faced a P159.18-million assessment from the BIR, which was eventually reduced to P103.68 million.<\/p>\n\n\n\n

The assessment covered alleged deficiencies in income tax, value-added tax (VAT), and other tax categories for the 2014 fiscal year.<\/p>\n\n\n\n

In ruling in favor of DMCI, the tribunal said that there was no factual basis for the BIR to determine and set DMCI\u2019s taxable income per income tax return (ITR) as zero, as records showed DMCI suffered a net loss of over P159 million.<\/p>\n\n\n\n

The tribunal added that DMCI was correct in arguing that the BIR\u2019s method of computation would result in double disallowance.<\/p>\n\n\n\n

Based on the report of the independent certified public accountant, DMCI arrived at a net loss of over P159 million.<\/p>\n\n\n\n

DMCI also claimed stock issuance costs of over P92 million as part of its other deductions, arriving at a net loss of more than P159 million.<\/p>\n\n\n\n

The court noted that if the stock issuance costs were disallowed, DMCI\u2019s net loss would decrease to more than P66 million, but this would not create any taxable income for a deficiency.<\/p>\n\n\n\n

However, under the BIR\u2019s method, disallowing the stock issuance costs would generate a taxable income of P92,922,746, resulting in a deficiency of P27,876,823.80.<\/p>\n\n\n\n

\u201cThis tax liability is expectedly arrived at since the respondent used zero as the tax base, and again deducted the same expense based on the finding of his or her disallowance,\u201d it said.<\/p>\n\n\n\n

\u201cHowever, in this method, the respondent had seemingly disallowed all the expenses that the petitioner had claimed as deductions for [year] 2014 without any evidence to support its action. Simply put, this transgresses the petitioner\u2019s right to due process.\u201d<\/p>\n\n\n\n

(News Source: Business World<\/a>)<\/em><\/p>\n\n\n\n

<\/div>\n\n\n\n

This report is prepared by PinoyInvestor\u2019s partner broker below. Find out more about our partner brokers<\/a> and sign up to avail their complete trading brokerage services.<\/em><\/em><\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

Take advantage of the price opportunity that might arise when the news hits. Trade the news!<\/p>\n","protected":false},"author":11,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1371],"tags":[],"class_list":["post-329733","post","type-post","status-publish","format-standard","hentry","category-trade-the-news","generate-columns","tablet-grid-50","mobile-grid-100","grid-parent","grid-33"],"_links":{"self":[{"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/posts\/329733","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/users\/11"}],"replies":[{"embeddable":true,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/comments?post=329733"}],"version-history":[{"count":1,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/posts\/329733\/revisions"}],"predecessor-version":[{"id":329735,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/posts\/329733\/revisions\/329735"}],"wp:attachment":[{"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/media?parent=329733"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/categories?post=329733"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/tags?post=329733"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}