The Commission on Audit called out the Philippine National Railways over its non-compliance with tax laws, subjecting the agency to penalties and fines.

In its report covering 2022, state auditors found that the PNR did not remit withheld taxes within the reglementary period as mandated under Section 4.112-2 of Revenue Regulations 16-2005 and Section 2.58(2)(A) of RR 2-98.

Section 4.112-2 of RR 16-2005 requires that VAT withheld shall be remitted within 10 days following the end of the month the withholding was made, while Section 2.58(2)(A) of RR 2-98 stipulates that withholding tax returns, whether creditable or final, shall be filed and payments should be made within 10 days after the end of each month except for taxes withheld for December which shall be filed on or before 25 January of the following year.

Audit findings revealed that taxes withheld from the income payments made to different suppliers or payees recorded in the agency’s books totaling P16.786 million were not remitted within the prescribed period, defeating the said provisions.

“It was noted upon verification that the remittances of the corresponding withheld taxes from income payments made by PNR to various suppliers or payees totaling P21.313 million are not found in the Monthly Summary of Remittances of the agency,” the CoA said.