BIR tells poll bets: Collect campaign withholding tax

By Andrew B. Doga-ong

BONTOC, Mt. Province -- Political candidates in the May 13 midterm elections were urged to start doing their civic duty by collecting five percent withholding tax on their payments on political contributions and campaign expenditures.

Esteban Acapen, acting assistant revenue district officer here, said under the Bureau of Internal Revenue Regulation 8-2009, all political candidates, political parties and contributors are required to register with the Revenue Generating Office as withholding agents.

All income payments made by political parties and candidates of local and national elections on their purchase of goods and services for their campaign shall be subject to a 5 percent Creditable Withholding Tax (CWT).

Acapen said the 5 percent CWT is not tax imposed on the candidate, political party or contributor but on the supplier or provider of goods and services which is collected with the help of the candidates or contributors under the withholding tax system.

CWT is a tax on the income of suppliers of goods and services who will be earning income when they provide the materials and services for the campaign requirements of the candidates, political parties and contributors, Acapen said.

The candidates, political and contributors as withholding agents will then remit the CWT they withheld within ten days after the end of each month which will eventually be deducted from the suppliers’ income tax.

The BIR regulation also requires individuals, corporations, associations and other judicial persons to impose the 5 percent withholding tax on their purchase of goods and services that are intended as campaign contributions to political parties and candidates.

The revenue generating office considers the election periods as big source of tax revenues as candidates, their political parties and supporters are expected to incur huge campaign expenditures.