Updated Withholding Tax Rates on MERALCO payments and interest on loans
(Revenue Regulations No. 1- 2019, February 12, 2019)
This Tax Alert is issued to inform all on the updated creditable/expanded withholding tax rates on (1) payments by MERALCO and other electric distribution utilities, and (2) interest income on debt instruments not classified as deposit substitutes.
Pursuant to TRAIN Law, the rate of withholding shall not be less than one percent (1%) but not more than fifteen percent (15%) of the income payment. Thus, the creditable/expanded withholding tax rates applicable on the following income payments were updated effective January 1, 2019:
Based on the above, the highest creditable/expanded withholding tax rate applicable now is 15%.