NINETEENTH CONGRESS OF THE) 
REPUBLIC OF THE PHILIPPINES ) 
First Regular Session 
)
Senate
'N£F-.Cvl©f{i£r of tlif
'22 AUG -8 AH 50
SENATE
s. no.1077
RECEIVED BY:
Introduced by Senator Manuel "Lito" M. Lapid
AN ACT
TO DEFINE AND PROTECT THE RIGHTS OF TAXPAYERS 
EXPLANATORY NOTE
The legal doctrine states that "[t]he power to tax Is the power to destroy. ... 
To carry it to the excess of destruction, would be an abuse, to presume which, 
would banish that confidence which is essential to all government."1
Ang buwis po ay ang dugong bumubuhay sa ating gobyerno. Kung wala po ito 
ay hindi po makagagaiaw ang ating mga pampublikong tanggapan at wala po tayong 
serbisyong maibibigay sa ating mga kababayan.
Subalit kahit po mahalaga ang buwis ay hindi po natin ito dapat ipatupad sa 
paraang naabuso ang karapatan ng ating mga kababayang nagbabayad ng buwis. 
BiJang kaakibat po ng ating gobyerno sa maayos na pamumuno, dapat po ay 
panatilihin natin ang pagkilala sa karapatan ng ating mga mamamayan. Sa ganito ay 
mapapanatili po natin ang tiwala ng ating mga kababayan sa ating gobyerno at tataas 
po ang kumpiyansa nilang sumunod sa batas at magbayad ng buwis.
It is declared the policy of the State to provide a balance between the protection 
of the taxpayers against abuses and at the same time, consistent and strict compliance
1 McCulloch V. Maryland. 4 Wheat. 316 (1819)


with the National Internal Revenue Code (NIRC) of 1997, as amended, and the 
Customs Modernization and Tariff Act (CMTA), and all other rules and regulations.
Rights and remedies for the taxpayers are already provided in the NIRC, CMTA, 
and all other laws such as Republic Act No. 1125. However, the same seem to be 
inadequate especially given ihe reports of certain individuals who have allegedly been 
subjected to harassment by some officials and employees of the Bureau of Internal 
Revenue (BIR) and the Bureau of Customs (BOC), including but not limited to, the 
filing of undue and baseless complaints.
Thus, this bill seeks to further grant the taxpayers the following: a) taxpayers' 
basic rights; (b) taxpayers' rights In civil cases; and (c) taxpayers' rights In criminal 
cases, whether at the administrative level or at the judicial level. In order to achieve 
this, the National Taxpayers Advocate is to be created in order to promote tax 
compliance and assist taxpayers.
In view of the foregoing, early passage of this bill is earnestly requested.
MANUEL "LITO" M. LAPID
Senator


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NINETEENTH CONGRESS OF THE) 
REPUBLIC OF THE PHILIPPINES ) 
First Regular Session 
)
Jennie
of tlje Bi tviUivp
’22 AUG -8 All SO
SENATE
Rfc’CEI'/ED B
Introduced by Senator Manuel "Lito" M. Lapid
AN ACT
TO DEFINE AND PROTECT THE RIGHTS OF TAXPAYERS
Be it enacted by the Senate and House of Representatives of the Philippines in 
Congress assembled:
Section 1. Title. - This Act shall be known as "The Taxpayer Bill of Rights Act".
Section 2. Declaration of Policy. - It is hereby declared the policy of the State 
to provide increased protection of taxpayers' rights in complying with the National 
Internal Revenue Code of 1997, as amended, the Customs Modernization and Tariff 
Act, and all other rules and regulations, to the end that abuses committed against 
taxpayers are mitigated, if not completely avoided, and taxes are collected 
responsibly, with due regard for taxpayers' rights.
Section 3. Taxpayer's Bill of Rights. - In addition to the rights and remedies 
of the taxpayers as provided for in the National Internal Revenue Code (NIRC) of 
1997, as amended; Customs Modernization and Tariff Act (CMTA), as amended; 
Republic Act No. 1125, as amended, creating the Court of Tax Appeals (CTA); and all 
other laws, rules and regulations, issuances, and circulars in support thereof, the 
taxpayers are hereto granted the following: a) taxpayers' basic rights; b) taxpayers' 
rights in civil cases; and c) taxpayers' rights in criminal cases, whether at the 
administrative level or at the judicial level, concerning tax assessments, collection and 
refund, and prosecution for criminal cases.


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rights:
Section 4. iaxpayers' Basic Rights. - The following are the taxpayers' basic
a) The right to be informed of any pending assessment, investigation for 
criminal tax cases, collection or any other cases filed against the taxpayer 
or that the taxpayer is a subject of any request for third-party information 
or any lifestyle check for purposes of tax compliance. The right to available 
information and prompt, accurate responses to questions and requests for 
tax assistance shall always be ensured. In this regard, all revenue officers 
and agents shall undergo regular training and evaluation on a variety of job 
standards including customer relations. This standard requires agents to 
ensure that they fully explain to taxpayers their rights under the law;
b) The right to obtain simple, nontechnical statements, which explain the 
reason for audit selection and the procedures, remedies, and rights available 
during audit, appeals and collection proceedings. These rights include, but 
are not limited to, the rights pursuant to this Taxpayers' Bill of Rights and 
the right to be provided with a narrative description which explains the basis 
of audit changes, proposed assessments, assessments and denials of 
refunds, identifies any amount of tax, interest, or penalty due, and states 
the consequences of the taxpayer's failure to comply with the notice;
c) The right to have a speedy and Impartial disposition of cases, the right to 
due process and the observance of rules regarding assessments, refunds or 
any other proceedings including requests for advisory rulings, clearances, 
termination letters and lifting of seizure, garnishment and forfeiture orders, 
whether it be against the taxpayer or against the officials and staff of the 
Tureau of Internal Revenue (BIR), the Bureau of Customs (BOC), and other 
government agencies, including government-owned and -controlled 
corporations (GOCCs), government financial institutions (GFIs), and local 
government units (LGUs) tasked with the enforcement of revenue or 
nan king and financial laws, whether of local or national application;


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d) The right to privacy as guaranteed by the Constitution, and the right to have 
any case or proceeding, including those involving third-party information 
requests against or involving the taxpayer, to be devoid of publicity, 
whether through radio, television, newspaper or any alternative media, 
while said case or proceeding is pending;
e) The right to seek assistance from the National Taxpayer Advocate who shall 
be responsible for facilitating the resolution of taxpayer complaints and 
problems not resolved through the normal administrative channels within 
che BIR or BOC, including any taxpayer complaints regarding unsatisfactory 
treatment by BIR or BOC employees. The taxpayers' rights advocate may 
issue a stay order if a taxpayer has suffered or is about to suffer irreparable 
loss as a result of an unjust action by the said Bureaus;
f) The right to have the taxpayer's tax information kept confidential unless 
otherwise authorized by law;
g) The right to participate in free education activities that help the taxpayer 
successfully comply with the revenue laws of the State;
h) The right to fair and consistent application of the tax laws of the State by 
the BIR and BOC;
i) The right to have the BIR begin and coniplete its audits in a timely and 
expeditious manner after notification of intent to audit through a letter of 
authority. Such audit shall be conducted only once per year unless otherwise 
provided by law;
j) 
1 he right to request for installment payment of tax liabilities under any 
compromise settlement or any assessed tax liabilities pursuant to Taxpayer 
Assistance Order;
k) The right to recover attorney's fees and litigation costs for tax assessments 
made without substantial justification, and for claims for tax refunds which 
are not acted upon for an unreasonable length of time at the administrative


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level, or cenied at the administrative level but subsequently allowed by the 
CTA if it appears that such denial was unjustified. The award of attorney's 
fees and costs of litigation shall be Included in the order upholding the 
taxpayer's claim;
l) The right to have interests and penalties abated in case of any unjustifiable 
error or delay caused by the tax authorities or their agents, including 
ministerial acts such as loss of records, personnel transfers, extended illness 
or leaves of absence, and personnel training; and
m) The right to have the assistance of counsel in criminal proceedings, should 
the taxpayer request for it.
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Section 5. Taxpayers' Rights in Civii Cases. - The following are the taxpayers'
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rights in civil cases:
a) The right to have the opportunity to have the case against the taxpayer 
amicably settled, as the case may warrant: Provided,, That in every stage of 
the proceeding, whether in the administrative or judicial level, the parties 
shall always be given the chance to exhaust all and every remedy available 
for the speedy settlement of the case: Provided, however. That nothing In 
this Act shall deprive the court of competent jurisdiction of its judicial 
prerogatives;
b) The right to be Informed of impending collection action which requires sale 
or seizure of property or freezing of assets, except jeopardy assessments, 
and the right to have at least thirty (30) days within which to pay the liability 
or seek further review;
c) The right to have all other collection actions attempted before a jeopardy 
assessment suspended, unless delay will endanger collection and, after a 
jeopardy assessment, the right to have an immediate review of the jeopardy 
assessment. As used herein, jeopardy assessment is a tax assessment made 
by an authorized revenue officer (RO) without the benefit of a complete or 
partial audit, considering the RO's judgment that the assessment and


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collection of a deficiency tax will be jeopardized by delay caused by the 
taxpayer's failure to: (1) comply with audit and investigation requirements 
to present his books of accounts and/or pertinent records; or (2) 
substantiate all or any of the deductions, exemptions or credits claimed in 
his return;
d) The right to seek review, through formal or informal proceedings, of any 
adverse decisions relating to determinations in the audit or collection 
processes and tie right to seek a reasonable administrative stay 
enforcement action while the taxpayer pursues other administrative 
remedies available under the law;
e) The right to be Informed of the procedures for conditional termination of 
tax obligations through installment payment agreements which recognize 
both the taxpayer's financial condition and the best interests of the State: 
Provided/ That the taxpayer gives accurate and current information and 
meets all other tax obligations on schedule;
f) The right to be informed of the procedures for requesting cancellation, 
release, or modification of liens filed by the BIR and the BOC and for 
requesting that any lien which is filed in error be so noted on the lien 
cancellation filed by the BIR and the BOC, with public notice to any credit 
agency at the taxpayer's request;
g) The right of the taxpayer in a judicial or administrative action brought or 
maintained without the support of justiciable issues of fact or law, to recover 
all costs of the administrative or judicial action, including reasonable 
attorney's fees; and
h) The right to waiver of interest that accrues as the result of errors or delays 
caused by a BIR/BOC employee: Provided, That the provisions of Rule 63 
of the Rules of Civil Procedures (Declaratory Relief and Similar Remedies) 
shall likewise be applicable to the aggrieved taxpayer.


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Section 6. iaxpayers' Rights in Criminal Tax Cases. - The following are the
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taxpayers' rights in criminal tax cases:
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a. The right to be knowledgeably and intelligently informed of the charges as 
contained in any properly and timely prepared audit report, assessment 
notice, correspondence, document, letter and the like, as implemented by 
rules and regulations, as the case may be, coming from the BIR or BOC or 
any government agency tasked to enforce the revenue laws and banking 
and financial laws, in appropriate cases;
b. The right to be given ample and adequate opportunity, as the situation may 
warrant, to present evidence at the taxpayer's or anybody else's possession 
that would assist the taxpayer in the pursuit of the case;
c. The right to seek the assistance of competent and willing counsel of the 
taxpayer's own choice, to help and assist in the preparation or defense of 
the case;
d. The right to be served with all the necessary documents and papers 
appurtenant thereto, relative to the charges against the taxpayer, in a 
manner that would assist and expeditiously present the taxpayer's side 
pursuant to the charges against the taxpayer;
e. The right to present the taxpayer's own witnesses; and
f. The right to be represented or advised by counsel or other qualified 
representatives at any time in administrative interactions with the BIR and 
"che BOC; the right to procedural safeguards with respect to recording of 
interviews during tax determination or collection processes conducted by 
the BIR and the BOC; the right to be treated in a professional manner by 
the BIR and the BOC personnel; and the right to have audits, inspections of 
records, and interviews conducted at a reasonable time and place except in 
criminal and internal investigations.


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Section 7. Creation of the Office of the Nationai Taxpayer Advocate. - In order 
to protect the rights of taxpayers and in recognition of the complexity of tax laws, 
both substantive and procedural, there is hereby created the Office of the National 
Taxpayer Advocate to promote tax compliance and assist taxpayers, individual or 
juridical. The Office of the Nationai Taxpayer Advocate shall be under the 
administration and supervision of an official to be known as the National Taxpayer 
Advocate and shall be attached to the Office of the President for administrative 
purposes only. The National Taxpayer Advocate shall have the rank of Undersecretary 
and shall be appointed by the President of the Philippines.
The Nationai Taxpayer Advocate shall be a Filipino citizen, at least forty (40) 
years of age, a member of the Philippine Bar in good standing, with at least ten (10) 
years of practice In the Held of taxation, with proven Integrity and competence, and 
must not have been convicted of any crime involving moral turpitude.
An individual cannot be appointed as the Nationai Taxpayer Advocate if such 
individual has been an employee or officer of, or has rendered service as consultant 
or in any other capacity to, the BIR or the BOC or any of Its agencies or has been a 
local treasurer for two (2) years prior to such appointment. A National Taxpayer 
Advocate cannot serve as officer or employee or consultant of, or be appointed to or 
act in whatever capacity In, rhe BIR or the BOC or as local treasurer, within five (5) 
years following his/her tenure as a Nationai Taxpayer Advocate. For purposes of this 
Act, a local treasurer includes a municipal, city or provincial treasurer.
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Section 8. Functions of Office of the Taxpayers Advocate. - It shall be the
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function of the Office of the Taxpayers Advocate to:
a. Assist taxpayers in resolving their problems wFth the BIR and BOC;
b. Identify areas in which taxpayers have problems in dealings with the BIR 
and BOC;
c. Propose changes, to the extent possible, in the administrative practices of 
the BIR and BOC with the end view of mitigating problems identified under 
the preceding paragraph;


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d. Identify potential legislative changes which may be appropriate to mitigate 
such problems;
e. Issue taxpayer assistance orders upon application filed by a taxpayer with 
the Office of the National Taxpayer Advocate. The latter may issue a 
Taxpayer Assistance Order when: (i) it is determined that the taxpayer is 
suffering or about to suffer a significant hardship as a result of the manner 
in which tne internal revenue laws are being administered by the BIR, BOC 
or the local treasurer; or (ii) the taxpayer meets such other requirements 
as are set forth in the implementing rules and regulations of this Act. For 
purposes of this paragraph, a significant hardship shall include: (i) an 
immediate threat of adverse action; (Ii) any action that will violate the right 
:o privacy of a taxpayer; (Hi) a delay of more than thirty (30) days in 
resolving taxpayer account problems; (Iv) the taxpayer will incur significant 
and unnecessary costs, including fees for professional representation, if 
relief is not granted; or (v) irreparable injury to, or a long-term adverse 
mpact on, the taxpayer if relief is not granted. Nothing herein shall prevent 
the National Taxpayer Advocate from taking any action in the absence of 
an application mentioned herein;
f. 
In cases where any tax authority employee is not following the laws, rules 
and regulations or any applicable published administrative guidance, the 
National Taxpayer Advocate shall construe the factors taken into account in 
determining whether to issue a Taxpayer Assistance Order In the manner 
most favorable to the taxpayer;
g. Any Taxpayer Assistance Order issued by the National Taxpayer Advocate 
under this section may be modified or rescinded by the National Taxpayer 
Advocate, only if a valid written explanation was submitted by the 
Commissioner of Internal Revenue or the Commissioner of Customs, as the 
case may be, and that the reasons for the modification or rescission are 
specifically stated by the National Taxpayer Advocate in the rescission or 
modification order; and


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h. The duration of any period of limitation with respect to any action for which 
a Taxpayer Assistance Order has been issued shall be suspended for the 
period beginning c n the date of the taxpayer's application under subsection 
(e) and ending on the date of the National Taxpayer Advocate's decision 
with respect to such application and any period specified by the National
Taxpayer Advocate In a Taxpayer Assistance Order issued pursuant to such 
application.
Section 9. Submission of Annuai Reports by the Office of the National 
Taxpayer Advocate. - Not later than December 31 of each calendar year, the Office 
of the National Taxpayer Advocate shall submit a report to the Chairpersons of the 
Committee on Ways and Means of the Senate of the Philippines and House of 
Representatives on its activities during the fiscal year ending during such calendar 
year. Any such report shall contain full and substantive analysis, In addition to 
statistical information, and shall:
a. Tdentify the initiatives that the Office of the National Taxpayer Advocate has 
undertaken aimed at improving taxpayer services and the tax authorities' 
responsiveness;
b: Contain recommendations received from taxpayers by the Office of National 
Taxpayer Advocate;
c. Contain a summary of the most serious problems encountered by taxpayers, 
including a description of the nature of such problems;
d. Contain an inventory of the items described in subsections (a), (b), and (c)
of this Section for which no action has been taken and the result of such 
action;
e. Contain an inventory of items described in subsections (a), (b), and (c) of 
this Section for which action remains to be completed and the period during 
which each item has remained on such inventory;


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f. Contain an Inventory of the items described in subsections (a), (b), and (c) 
of this Section for which no action has been taken, the period during which 
each item has remained on such inventory, the reasons for the Inaction, and
identify any BIR and BOC official or employee who Is responsible for such 
Inaction;
g. Identify any Taxpayer Assistance Office orders/recommendations which 
was not honored by the BIR and the BOC in a timely manner;
h. Contain recommendations for such administrative and legislative action as 
may be appropriate to resolve problems encountered by taxpayers;
i. 
Identify areas of ti le tax law that impose significant compliance burdens on 
taxpayers, the BIR, the BOC, and local treasurers Including specific 
recommendations for remedying these problems;
j. Identify the most litigated issues for each category of taxpayers. Including 
recommendations for mitigating such disputes; and
k. Include such other information as the National Taxpayer Advocate may 
deem relevant.
Eacn report required under this subparagraph shall be provided directly to the 
Committee on Ways and Means of the Senate of the Philippines and the House of 
Representatives without any prior review or comment from the respective 
Commissioner of BIR or BOC or any other officer or employee of the said Bureaus. 
The National Taxpayer Advocate shall furnish copies of said report to the Secretary of 
Finance, and to the respective Commissioners of the BIR and BOC.
The Commissioners of the BIR and BOC shall establish procedures requiring a 
formal response to all recommendations submitted to them by the National Taxpayer 
Advocate within three (3) months from the date of submission.
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Section 10. Other Responsibilities of the National Taxpayer Advocate. - The
21 National Taxpayer Advocate shall:
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a. Monitor the coverage and geographic deployment of local officers of 
taxpayer advocates;
b. Develop guidelines to be distributed to all BIR and BOC officers and 
employees and the local treasurers outlining the criteria for referral of 
taxpayer Inquiries to local offices of taxpayer advocates;
c. Ensure that the local telephone number for each local office of the taxpayer 
advocate s published and available to taxpayers served by the office; and
d. Develop career paths for local taxpayer advocates in the Office of the 
National Taxpayer Advocate.
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Section 11. Personnel Actions of the National Taxpayer Advocate. - The
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National Taxpayer Advocate shall have the responsibility and authority to:
a. Appoint local taxpayer advocates and make available at least one (1) such 
advocate for each province; and
b. Evaluate and take personnel actions including dismissal with respect to any 
employee of any local office of the National Taxpayer Advocate described in 
subsection (a) of this Section.
The National Taxpayer Advocate may consult with the appropriate supervisory 
personnel of the BIR and BOR in carrying out the National Taxpayer Advocate's 
responsibilities and qualifications under this Section.
Section 12, Remedies. - Any violation of the provisions of this Act committed 
by any official or employee of the BIR or the BOC, other than the Commissioner of 
Internal Revenue and Commissioner of Customs, shall be filed with the office of the 
Commissioner of Internal Revenue or the Commissioner of Customs, as the case may 
warrant. With the assistance of the National Taxpayer Advocate. The Commissioner of 
Internal Revenue or the Commissioner of Customs shall decide the controversy 
expeditiously, which shall not in any case be more than sixty (60) days from the time 
the complaint or case is filed with their respective offices. Decisions of the 
Commissioner of Internal Revenue or the Commissioiier of Customs concerning any
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complaint or casG for violation of tha provisions of this Act, may bG brought for rGviGW 
by thG aggriGVG party or the lattGr's authorizGd roprosontative, to the Secretary of 
Finance. In case the Commissioner of Internal Revenue or Commissioner of Customs 
fail to act on such complaint or case within the time herein prescribed, the aggrieved 
party or the latter's authorized representative may file the complaint or case directly 
with the Secretary of Finance.
Complaints against the Commissioner of Internal Revenue or the Commissioner 
of Customs for violation of this Act shall be filed directly with the Secretary of Finance 
who shall decide the case within sixty (60) days from the date the complaint was filed. 
Decisions of the Secretary of Finance may be appealed before the Office of the 
President.
Any complaint or case filed pursuant to this Section shall be without prejudice 
to any other action that may be Instituted against the employee or official of the BIR 
or the BOC under existing laws, rules and regulations.
Evidence against the taxpayers obtained In relation to this Act shall be 
inadmissible in any court or proceeding if found to have been obtained in violation of 
any of the above-enumerated taxpayer's rights.
Section 13. Penalties for the Violation of the Bill of Rights of Taxpayers. - Any 
person or public official who Is found to have violated the Bill of Taxpayer's Rights 
shall be punished with imprisonment of not less than six (6) years nor more than 
twelve (12) years and a fine of not less than one hundred thousand pesos (Php 
100,000.00) but not more than five hundred thousand pesos (:)hp. 500,000.00).
Section 14. Report of the Secretary of Department of Finance. - On or before 
June 1 of each calendar year, the Secretary of the Department of Finance (DOF) shall 
submit and present to both the Chairpersons of the Senate and Flouse of 
Representatives Ways and Means Committee a report on: (a) All categories of 
incidents Involving the misconduct of the officers and employees of the BIR and BOC
during the preceding calendar year; and (b) Action on and disposition of any such 
instances.
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Section 15. Implementing Rules and Regulations. - Within thirty (30) days
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from the effectivity of this Ai t, the following shall promulgate the necessary rules and
3 regulations for its effective implementation:
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a) A representative from the DOF;
b) A representative from the BIR;
c) A representative from the BOC;
d) A representative from the Secretariat of the Congressional Oversight 
Committee on Comprehensive Tax Reform Program;
e) Representatives from the Committee on Ways and Means of both Houses 
of Congress; and
f) A representative each from a business association and the Philippine 
Institute of Certified Public Accountants (PICPA).
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Section 16. Separability Clause. - If any provision of this Act is declared invalid
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or unconstitutional, other provisions hereof which are not affected thereby shall
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remain in full force and effect.
Section 17. Repealing Clause. - All laws, orders, decrees, rules and
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regulations, and other parts thereof inconsistent with the provisions of this Act are
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hereby repealed, arrended or modified accordingly.
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Section 18. Effectivity Clause. - This Act shall take effect fifteen (15) days
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after its publication in the Official Gazette or in at least two (2) national newspapers
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of general circulation.
Approved,
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