Ramco Systems Stands Strong: Philippine Subsidiary Takes Proactive Steps in Tax Dispute

Image Source: IndiaMART

On June 3, 2025, the Commissioner of Internal Revenue (CIR) made a significant ruling, demanding PHP 60.18 million (around Rs. 92.89 million) from RSI for the financial year 2017–18. This assessment spans various tax categories, including Income Tax, Value Added Tax, Expanded Withholding Tax, Withholding Tax on Compensation, Documentary Stamp Tax, Final Withholding Tax, and accrued interest. RSI has firmly contested these claims and plans to appeal the decision to the Court of Tax Appeals (CTA) within the legal timeframe.

Key Highlights

Tax Demand Details: The CIR’s order is asking for PHP 60.18 million (approximately Rs. 92.89 million) from RSI, covering a variety of tax categories and interest for FY 2017–18.
Company’s Response: RSI is challenging the tax assessment and intends to file an appeal with the Philippines’ Court of Tax Appeals, which specializes in handling such tax disputes.
Ramco’s Confidence: The parent company, Ramco Systems Limited, has a track record of contesting tax demands and, based on legal counsel, feels optimistic about achieving a favorable outcome in this situation.
No Immediate Financial Outflow: Previous disclosures indicate that if the appeal doesn’t go in their favor, the company might lose certain tax credits or carry-forward losses, but there shouldn’t be an immediate cash outflow.
Recent Financial Performance: Ramco Systems reported impressive financial results for the quarter ending March 2025, showcasing a remarkable 122.87% year-on-year growth in profit before tax, highlighting strong business fundamentals.

What’s Next?

RSI’s appeal will now move forward in the Court of Tax Appeals, which will evaluate the CIR’s decision. Investors and industry observers will be keeping a close eye on the outcome, given the potential financial ramifications and Ramco’s ongoing global operations.

Source: The Economic Times