True to his promise for “Project Valentine”, Commissioner Joel L. Tan-Torres came out with Revenue Memorandum Order (RMO) No. 16-2010 last February 5, 2010 prescribing policies and guidelines in monitoring motels and other similar establishments just in time for Valentine’s Day.

For this year, motels owners are required to submit to their respective Revenue District Office (RDO) within ten (10) days from the issuance of RMO 16-2010, a Sworn Declaration stating the room type, no. of rooms and rate per room of their establishment. Next year and thereafter, said declaration shall then be regularly submitted on or before January 31.

After submission of the said declaration, the RDO will then evaluate and compute the monthly output tax revenue by preparing an Occupancy Turnover Analysis Report (OTAR).

Discrepancies noted in the OTAR will be communicated by the RDO to the motel owner for their amendment of tax returns filed and payment of the corresponding additional output VAT.

No penalties and surcharges shall be imposed and no Mission Order to conduct surveillance will be issued against a particular motel establishment which amended its returns and paid the deficiency VAT.

However, for non-compliant establishments, surveillance and enforcement activities will be pursued with the posting of BIR personnel in the motel premises over a period of not less than ten (10) days to monitor business operations.

In the course of the surveillance activity, any understatement of thirty (30) percent or more of the motel’s correct taxable sales for the taxable quarter will subject the concerned motel to “Oplan Kandado”. For those with tax evasion cases, BIR can initiate administrative and criminal proceedings by the filing of a case under the Run After Tax Evaders (RATE) Program. (mldn)