Rodriguez says BIR order requiring private persons to file AIR is illegal

CAGAYAN DE ORO CITY, March 15, 2011—Rep.Rufus Rodriguez, a former dean of a college of law in a Manila university, yesterday said that Finance Secretary Cesar V. Purisima’s new tax scheme requiring private individuals earning P500,000 a year to file an Annual Information Return (AIR) is illegal and unconstitutional.
                “It’s an illegal and unnecessary intrusion of the state into the lives of private individuals,” he said.
                Rodriguez filed last week a resolution questioning the BIR’s plan requiring private individuals to fill up an AIR along with their filing of income tax returns. 
                He said this new requirement, contained in Revenue Regulations 2-2011 dated March 1 which was signed by Purisima, violates the constitutional right of individuals to privacy.
                The order requires persons earning at least P38,461 monthly including the mandatory 13th month pay to file an AIR, which is similar to the Statement of Assets, Liabilities and Net Worth (SALN) required of public 
officials.
                Only government officials are required by law to file their SALN.
                He also pointed out that the National Internal Revenue Code did not mandate the BIR to require the filing of the AIR.
                He stressed that instead of requiring private individuals of filing their AIR, the BIR should wait for Congress to legislate a law allowing “this additional requirement during the filing of their annual tax returns (ITR).”  
                He also advised BIR to establish first the legality of the AIR before implementing it to avoid costly lawsuits.
                But Internal Revenue Commissioner Kim Henares justified the AIR as part of the government’s campaign to increase revenue collection.
                Henares also said that the AIR is only optional this year but will be mandatory next year.
                Presidential spokesperson Edwin Lacierda also defended the AIR, saying it is not the same as SALN.
                Lacierda said the AIR is important for transparency.
                Revenue Regulations 2-2011 prescribed the filing of income tax returns and/or annual information returns by certain individuals, including estates and trusts, resident aliens, and non-resident aliens engaged in trade in the country.
                It states that “starting [this year], individuals, estates, and trusts required to file an income tax return should file it together with an annual information return.”
                The regulations also states that those who are not required to file an ITR may still file it “for purposes of loans or foreign travel requirements” and if they file an ITR, they should likewise attach an AIR. (Bong D. Fabe)