In relation to my previous entry on tax incentives for pro bono legal services, Republic Act No. 9999, or the “Free Legal Assistance Act of 2010”, which was approved on February 23, 2010, declares that it is the policy of the State to value the dignity of every human person and guarantee the rights of every individual, particularly those who cannot afford the services of legal counsel; that it is the policy of the State to promote a just and dynamic social order that will ensure the prosperity and independence of the nation and free the people from poverty through policies and programs that provide adequate social services and improve the quality of life for all; and that the State shall guarantee free legal assistance to the poor and ensure that every person who cannot afford the services of a counsel is provided with a competent and independent counsel preferably of his/her own choice, if upon determination it appears that the party cannot afford the services of a counsel, and that services of a counsel are necessary to secure the ends of justice and protect of the party. (Sec. 2).
The law defines the term “legal services to be performed by a lawyer” to refer to any activity which requires the application of law, legal procedure, knowledge, training and experiences which shall include, among others, legal advice and counsel, and the preparation of instruments and contracts, including appearance before the administrative and quasi-judicial offices, bodies and tribunals handling cases in court, and other similar services as may be defined by the Supreme Court. (Sec. 3).
For purposes of availing of the benefits and services as envisioned in the law, a lawyer or professional partnership shall secure a certification from the Public Attorney's Office (PAO), the Department of Justice (DOJ) or accredited association of the Supreme Court indicating that the said legal services to be provided are within the services defined by the Supreme Court, and that the agencies cannot provide the legal services to be provided by the private counsel. (Sec. 4).
For purpose of determining the number of hours actually provided by the lawyer and/or professional firm in the provision of legal services, the association and/or organization duly accredited by the Supreme Court shall issue the necessary certification that said legal services were actually undertaken. (id.).
The certification issued by, among others, the PAO, the DOJ and other accredited association by the Supreme Court shall be submitted to the Bureau of Internal Revenue (BIR) for purposes of availing the tax deductions as provided for in this Act and to the DOJ for purposes of monitoring. (id.).
For purposes of the law, a lawyer or professional partnerships rendering actual free legal services, as defined by the Supreme Court, shall be entitled to an allowable deduction from the gross income, the amount that could have been collected for the actual free legal services rendered or up to ten percent (10%) of the gross income derived from the actual performance of the legal profession, whichever is lower: Provided, That the actual free legal services herein contemplated shall be exclusive of the minimum sixty (60)-hour mandatory legal aid services rendered to indigent litigants as required under the Rule on Mandatory Legal Aid Services for Practicing Lawyers, under BAR Matter No. 2012, issued by the Supreme Court. (Sec. 5).
Let us wait within ninety (90) days from the date effectivity of the law for the BIR shall formulate the necessary revenue regulations for the proper implementation of the tax component. The Supreme Court shall formulate the necessary implementing rules and regulations with respect to the legal services covered under this Act and the process of accreditation of organizations and/or associations which will provide free legal assistance. (Sec. 8).
(Note: visit lawphil.net for the full text of the law).
