July 25, 2014
BSP MEMORANDUM NO. M-2014-029
| TO | : | All Banks and Non-Bank Financial Institutions with Quasi-Banking Functions |
| SUBJECT | : | Withholding of Percentage Tax — Gross Receipt Tax (GRT) |
Under Revenue Regulations No. 02-98, the Bangko Sentral ng Pilipinas (BSP) is required to deduct and withhold the percentage taxes, GRT due from its payments to all banks and non-bank financial institutions with quasi-banking functions, to quote as follows:
"xxx xxx xxx
SEC. 5.116. Withholding of Percentage Tax. —
Bureaus, offices and instrumentalities of the government, including government-owned or controlled corporations as well as their subsidiaries, provinces, cities and municipalities making any money payment to private individuals, corporations, partnerships and/or associations are required to deduct and withhold the taxes due from the payees on account of such money payments.
(A) Internal revenue taxes required to be withheld. — Percentage taxes on gross money payments, to the following shall be subjected to withholding at the rates herein prescribed:
"xxx xxx xxx
(5) Banks and non-bank financial intermediaries —
(a) On interest, commissions and discounts paid or given to banks and non-bank financial intermediaries arising out of...
