[Answer/discuss the question below, or see 2017 bar exam Taxation Instructions; 2016 Taxation Questions: 1, 2, 3, 4, 5, 6, 7, 8, 9, 11, 12, 13, 14, 15, 16, 17, 18, and 19; See also 2017 Bar Exam: Information, Discussions, Tips, Questions and Results]
On January 27, 2017, Ramon, the comptroller of Vantage Point, Inc., executed a document entitled Waiver of the Statute of Limitations in connection with the BIR’s investigation of the tax liabilities of the company for the year 2012. However, the Board of Directors of Vantage Point, Inc. did not adopt a board resolution authorizing Ramon to execute the waiver.
On October 14, 2017, Vantage Point, Inc. received a preliminary assessment notice from the BIR indicating its deficiency withholding taxes for the year 2012. Vantage Point, Inc. filed its protest. On October 30, 2017, the BIR issued a formal letter of demand and final assessment notice. Vantage Point, Inc. again filed a protest. The Commissioner of Internal Revenue denied the protests and directed the collection of the assessed deficiency taxes.
Accordingly, Vantage Point, Inc. filed a petition for review in the CTA to seek the cancellation and withdrawal of the assessment on the ground of prescription.
(a) What constitutes a valid waiver of the statute of limitations for the assessment and collection of taxes? Explain your answer. (3o/o)
(b) Has the right of the Government to assess and collect deficiency taxes from Vantage Point, Inc. for the year 2012 prescribed? Explain your answer. (3%)