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Tax treatment of land transportation businesses
Revenue memorandum circular no. 70-2015 deals with the tax incidence of the business of land transportation, particularly transport network companies (TNCs) eg taxi firms. Taxand Philippines shares an overview.
The TNC may or may not have been granted a Certificate of Public Convenience (CPC). If it is a holder of a valid and current CPC, it is known as a common carrier and its gross receipts are subject to 3% common carriers tax under Section 117 of the National Internal Revenue Code of 1997. Otherwise, it is classified as a land transportation service contractor and is subject to 12% VAT under the NIRC.
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