Package 1B: Tax Amnesty

The Tax Amnesty Act or Package 1B of the Comprehensive Tax Reform Program complements the Tax Reform for Acceleration and Inclusion Act or TRAIN. It allows errant taxpayers to affordably settle their outstanding tax liabilities, allowing for a “fresh start,” while also providing the government with additional revenues for its priority infrastructure and social programs. At the same time, it signals the start of a more aggressive tax enforcement campaign by tax authorities.

Estate tax amnesty unravels long unsettled estates due to non-payment of estate taxes, and to ensure a proper mechanism for its transfer.

General tax amnesty encourages the declaration of assets of taxpayers to ensure that these taxpayers can “wipe the slate clean; allows the government to collect from erring taxpayers and focus its efforts in ensuring better tax enforcement moving forward; and develops a database of availers for verification and monitoring purposes.

Tax amnesty on delinquencies allows previously excluded taxpayers (i.e., those charged under the Run After Tax Evaders (RATE) program, those with tax delinquencies) to take advantage of a lower rate to settle their obligations, and to give an opportunity to unclog the administrative and judicial dockets of slow-moving cases.

Legislative Status

Republic Act No. 11213
signed into law on 14 February 2019 (with line veto)

In passing RA 11213, the President vetoed the grant of general tax amnesty due to lack of safeguards against tax evasion. He calls for the passage of another tax amnesty bill that provides for the lifting of bank secrecy rules for fraud cases, the inclusion of automatic exchange of information, and safeguards to ensure that asset or net worth declarations are truthful for the following purposes:

  1. Lifting of bank secrecy laws. To fully achieve tax transparency that is in line with international practice, bank accounts should be open to scrutiny for tax purposes upon authority given by the Commissioner before a tax evasion case is filed in court. If bank account information is accessible without need for an order of a competent court, the Bureau of Internal Revenue (BIR) can easily establish all possible sources of income of taxpayers, tax fraud investigations can be fast-tracked, and collection of back taxes expedited.
  2. Automatic exchange of information will allow the Philippines to exchange tax information, including bank account information of taxpayers with treaty partners, without the need for a request.

He also vetoed provisions under estate tax amnesty such as the one-time declaration and settlement of estate taxes on properties subject to multiple unsettled estates, and the presumption of correctness of the estate tax amnesty returns.

Salient Features and Provisions

Estate tax amnesty


Estate of decedents who died on or before 31 December 2017.

Tax rate

Six percent based on the decedent’s total net estate at the time of death.

Minimum tax amnesty

P5,000 if the value of the allowable deductions exceeds the value of the gross estate.

Immunity and privilege

The availing estate is granted immunity from the payment of all estate taxes, as well as any increments and additions thereto, arising from the failure to pay any and all estate taxes for the taxable year 2017 and prior years, and from all appurtenant civil, criminal, and administrative cases and penalties under the National Internal Revenue Code (NIRC) of 1997, as amended.


The following cases are not covered by the estate tax amnesty: (i) those under the jurisdiction of the PCGG (Presidential Commission on Good Governance); (ii) those involving unexplained wealth; (iii) those involving violations of AMLA (Anti-Money Laundering Act); (iv) those involving tax evasion and other criminal offenses under the NIRC, as amended; and (v) those involving frauds, illegal exactions and transactions, and malversation of public funds and property under the Revised Penal Code.

Tax amnesty on delinquencies

Coverage and rate

All national internal revenue taxes collectible by the BIR and the BOC for taxable year 2017 and prior years, falling under the types of delinquencies below:

Type of delinquency Amnesty taxes

(% of basic tax assessed)

Final and executory delinquencies and assessments; 40
Tax cases subject to final and executory judgment by the courts; and 50
Pending criminal cases with the Department of Justice or the courts for tax evasion and other criminal offenses under Chapter II of Title X and Section 275 of the NIRC of 1997, as amended; 60
Withholding tax agents with respect to unremitted withheld taxes. 100

Immunities and privileges

Those who avail are given the following:

  1. (i) immunity from the payment of all the balance of the basic, as well as increments and additions thereto, and all appurtenant civil, criminal, and administrative cases and penalties under the NIRC of 1997, as amended;
  2. (ii) termination of the criminal case and the corresponding civil or administrative case, if applicable;
  3. (iii) immunity from all suits or actions, including payment of said delinquency or assessment, as well as additions thereto, and from all appurtenant civil, criminal, administrative cases, and penalties under the NIRC of 1997, as amended; and
  4. (iv) cancelation of any notice of levy, attachments and/or warrants of garnishment.

Confidentiality and non-use of information

  1. All tax amnesty returns, STA, or SALN filed under the amnesty are confidential in nature and shall not be used in any investigation or prosecution before any judicial, quasi-judicial and administrative bodies.
  2. All statements and disclosures previously filed are deemed amended by the tax amnesty returns, STA or SALN and may not be the subject of any investigation or prosecution before any judicial, quasi-judicial and administrative bodies.

Information Management System (IMS)

An information management program shall be institutionalized for the effective use of information declared or obtained from the Tax Amnesty Returns and the STA or SALN filed.

P 500 million is earmarked for the purpose of establishing the IMS and the excess of collection shall be allotted for the Build, Build, Build infrastructure projects as provided under Section 82 of TRAIN Act.

Amendment of Section 270 of the NIRC of 1997

The penalties for BIR personnel violating the confidentiality of information to be exchanged with a foreign tax authority obtained from banks and financial institutions is increased from “P 50,000 to P 100,000,” to “P 500,000 to P 1 million”

Unlawful divulgence of tax amnesty return and appurtenant documents

The unlawful disclosure of any information from tax amnesty returns and appurtenant documents is punishable by a fine of P 150,000 and imprisonment of not less than 6 years but not more than 10 years.