City Failed On-Time Remittance of P52.8M Employee Contributions Last Year

The Commission on Audit (COA) prodded the officials of the Cebu City government not to fail in immediately remitting taxes and other employee contributions to agencies such as the BIR, Pag-IBIG, PhilHealth, and GSIS after discovering that some P50 million were not remitted on time.

COA cluster director for Local Government Units in Central Visayas, Delia Monte de Ramos, said that the city government did not immediately remit the withholding taxes of the employees, as well as their premiums and contributions required under the law.

Monte de Ramos said the irregularity was discovered by state auditors during examination of the city’s financial records last year.

Based on the auditors’ findings as of December 31, 2012, the city failed to remit a total of P52.8 million; P22.2 million for BIR, P23.2 million for GSIS, P5.2 million for Pag-IBIG, and P2.2 million for PhilHealth.

But the city officials said that they have already settled all of it early this year.

According to Monte de Ramos, the city government’s failure to remit on time could affect the employees’ benefits. There is also the possibility of the city government’s paying the surcharges or passing it on to the employees.

GSIS law and the National Health Insurance Act provide that the employer shall remit directly to the GSIS and PhilHealth the amount withheld from the salaries of their employees.

“The city’s continued non-remittance of these withheld taxes and contributions would result to either penalties relative to taxes with the BIR or adverse effect to the claims of benefits accruing to the members or employees of the city,” the state auditors’ report stated.

COA reminded the city government to ensure the immediate remittance of all withheld funds due to BIR, Pag-IBIG, PhilHealth, and GSIS to enable the employees to avail of the benefits from these agencies.