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Tax Sharing Agreement

Tax Sharing Agreement Template for Philippines

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Key Requirements PROMPT example:

Tax Sharing Agreement

"I need a Tax Sharing Agreement between the Provincial Government of Cebu and its component municipalities for sharing tourism tax revenues, to be implemented from January 2025, with quarterly distribution periods and specific provisions for online payment systems."

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Document background
The Tax Sharing Agreement is a vital instrument in the Philippine public finance system, used to formalize arrangements for sharing tax revenues between different levels of government. This document becomes necessary when implementing provisions of the Local Government Code of 1991 and related tax laws that require specific allocation of tax revenues. It is particularly relevant in cases of internal revenue allotment (IRA), special economic zone operations, or when establishing new tax collection and sharing mechanisms between national and local government units. The agreement includes comprehensive details about collection procedures, distribution formulas, timing of transfers, and accountability measures. It ensures transparency and efficiency in tax revenue sharing while maintaining compliance with Philippine tax laws and regulations. The document is essential for proper fiscal decentralization and financial management in the Philippine government context.
Suggested Sections

1. Parties: Identifies the contracting parties and their legal capacity to enter into the agreement

2. Background: Contextual information explaining the purpose and basis for the tax sharing arrangement

3. Definitions: Defines key terms used throughout the agreement, including specific tax-related terminology

4. Scope of Agreement: Specifies the types of taxes and revenue covered by the sharing arrangement

5. Tax Sharing Formula: Details the agreed formula or methodology for calculating tax shares

6. Collection and Distribution Mechanism: Procedures for collecting and distributing the shared tax revenue

7. Payment Terms: Timing and method of payments, including any adjustments or reconciliation processes

8. Accounting and Reporting: Requirements for maintaining records and providing financial reports

9. Audit Rights: Provisions for auditing tax collection and distribution

10. Compliance Requirements: Obligations to comply with relevant tax laws and regulations

11. Term and Termination: Duration of the agreement and conditions for termination

12. Dispute Resolution: Procedures for resolving disagreements between parties

13. Governing Law: Specification of Philippine law as governing law and relevant jurisdictions

14. General Provisions: Standard contractual provisions including amendments, notices, and severability

Optional Sections

1. Special Tax Zones: Include when agreement covers special economic zones or areas with unique tax treatments

2. Inter-governmental Coordination: Include when multiple government levels are involved in tax collection

3. Technology and Systems: Include when specific technology platforms or systems will be used for tax administration

4. Capacity Building: Include when agreement includes provisions for training and technical assistance

5. Emergency Provisions: Include provisions for handling force majeure events or economic emergencies

6. Environmental Tax Provisions: Include when agreement covers environmental taxes or green incentives

7. Transition Arrangements: Include when replacing existing tax sharing arrangements

Suggested Schedules

1. Schedule A - Tax Types and Rates: Detailed list of specific taxes covered and applicable rates

2. Schedule B - Distribution Formula: Detailed calculations and examples of the tax sharing formula

3. Schedule C - Collection Points: List of authorized collection points and responsible entities

4. Schedule D - Reporting Templates: Standard forms and templates for regular reporting

5. Schedule E - Key Personnel: List of key contacts and their roles in administering the agreement

6. Appendix 1 - Compliance Checklist: Checklist of regulatory requirements and compliance measures

7. Appendix 2 - Technical Systems: Technical specifications for any systems used in tax administration

8. Appendix 3 - Historical Data: Reference data from previous periods if applicable

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Linkedin in social icon imageX social icon image
alex.den.21@genieai.co
Relevant legal definitions
Agreement
Applicable Law
Audit Period
Authorized Representative
Barangay
Bureau of Internal Revenue
Business Day
Collection Period
Commencement Date
Computation Period
Department of Finance
Distribution Formula
Distribution Period
Effective Date
Fiscal Year
Force Majeure Event
General Fund
Government Entity
Internal Revenue Allotment
Local Government Code
Local Government Unit
Municipal Government
National Government
National Internal Revenue Code
Net Tax Collection
Payment Date
Provincial Government
Quarterly Period
Regional Development Authority
Revenue Sharing
Special Economic Zone
Share Percentage
Tax
Tax Collection
Tax Revenue
Tax Sharing Period
Tax Year
Taxing Authority
Term
Territory
Treasury
Trust Account
Working Day
Clauses
Definitions
Interpretation
Tax Collection
Revenue Sharing
Payment Terms
Distribution Mechanism
Calculation Method
Reporting Requirements
Record Keeping
Audit Rights
Compliance
Representations and Warranties
Confidentiality
Force Majeure
Dispute Resolution
Governing Law
Amendment
Assignment
Notices
Term and Termination
Severability
Entire Agreement
Authority and Capacity
Indemnification
Performance Standards
Default
Remedies
Waiver
Good Faith
Anti-Corruption
Information Rights
Accounting Standards
Banking Arrangements
Emergency Provisions
Review and Adjustment
Relevant Industries

Government and Public Sector

Financial Services

Public Administration

Tax Services

Local Government

Economic Zones

Infrastructure

Public-Private Partnerships

Regional Development

Municipal Services

Relevant Teams

Finance

Legal

Tax

Treasury

Government Relations

Compliance

Public Policy

Regulatory Affairs

Budget and Planning

Revenue Operations

Financial Control

Administrative Operations

Relevant Roles

Tax Director

Finance Manager

Local Government Treasurer

Revenue Collection Officer

Municipal Budget Officer

Chief Financial Officer

Tax Compliance Manager

Legal Counsel

Public Finance Officer

Revenue Operations Officer

Financial Controller

Budget Director

Treasury Operations Manager

Tax Administration Head

Government Affairs Director

Regulatory Compliance Officer

Public Policy Director

Financial Planning Manager

Industries
1987 Philippine Constitution: Fundamental law establishing the framework for taxation powers and local government autonomy (particularly Article X on Local Government)
Republic Act No. 7160 (Local Government Code of 1991): Defines the taxing powers of local government units and establishes the system for sharing national internal revenue taxes
National Internal Revenue Code (Tax Code): Comprehensive tax law establishing the framework for national internal revenue taxation and collection
Executive Order No. 292 (Administrative Code of 1987): Provides the framework for the administration of government including fiscal administration and revenue sharing
Republic Act No. 7643: Provides for the sharing of collections from national internal revenue taxes between national and local governments
Republic Act No. 8424 (Tax Reform Act of 1997): Updates and reforms various provisions of the National Internal Revenue Code affecting tax collection and distribution
Department of Finance Orders: Various administrative issuances governing the implementation of tax laws and revenue sharing arrangements
Bureau of Internal Revenue (BIR) Regulations: Implementing rules and regulations related to tax collection, administration, and sharing
Local Tax Ordinances: Specific local government unit regulations on tax collection and sharing within their jurisdictions
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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