The Department holds back taxes from salaries and payments to contractors but sometimes sends them to the government late. Over 12 million pesos in taxes was remitted late, and nearly 150 million remained unpaid after the first quarter of 2025. In one region, the Department withheld too little tax, causing overpayments to consultants, which violates tax rules.

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Original Audit Finding Excerpt

"DPWH was generally able to collect and withhold taxes totaling P63,295,780,468.11 from employees’ compensations, allowances and benefits, as well as from payments to contractors, consultants and suppliers for the procurement of infrastructure and road right -of-way projects, consultancy services, and goods/services in CY 2024, of which, P 12,556,422.74, was not remitted within the prescribed period under Bureau of Internal Revenue (BIR) Revenue Regulations (RR) No. 1 -2013. The remaining unremitted balance of P148,380,662.53, after considering remittances in the first quarter of 2025, including P46,888,084.19 in long -outstanding accounts, highlights gaps in fully meeting the timelines and procedural requirements set under BIR Revenue Regulations Nos. 11 -2018, 13 -2018, and 1 -2013, primarily due to manual processes, coordination issues, and tracking limitations, which may impact compliance and delay in the flow of funds critical to government operations. Moreover, the DPWH Cordillera Administrative Region under -withheld taxes totaling P228,638.45 leading to overpayments to consultants contrary to RR No. 10-2012 and Revenue Memorandum Order No. 23-2014."

Source Document