Aug 222016
This should be a good year for Goodyear Philippines as it has finally secured the confirmation of the Supreme Court (SC) on its 6-year-old refund case involving erroneously remitted tax on dividends amounting to about P14 million.
The SC ruled that gains from the redemption of preferred shares are exempt from Philippine income tax if the provisions of the tax treaty between the Philippines and the US are complied with. The tax treaty with the US provides that gains derived by a US resident from the sale of shares in a Philippine company shall only be taxable in the US if the Philippine company’s assets do not consist principally of real property. The gains should not be treated as dividends.