BIR collection up 9.64% in 2014, missing goal

MANILA, Philippines–Tax collections of the Bureau of Internal Revenue (BIR) in 2014 grew by almost a tenth, but fell short of the goal.

The BIR collected P1.334 trillion in taxes last year, up 9.64 percent from P1.217 trillion in 2013, preliminary data presented by Commissioner Kim S. Jacinto-Henares at a forum hosted by the Center for Philippine Futuristics Studies and Management Inc. last Friday showed.

The 2014 take, however, was 8.41-percent below the target of P1.46 trillion.

Henares later told reporters that since the figure she had presented was still “tentative” and unreconciled with the official figures to be released by the Bureau of the Treasury, the 2014 tax collection figure of the BIR could still go up.

When asked why the BIR missed last year’s goal, Henares said “mataas ‘yong target (the target was high).”

The preliminary data based on 1,209 reports of the BIR’s revenue district offices showed that the bulk or P1.297 trillion in collections last year was contributed by BIR operations.

Collections from BIR operations in 2014 rose 10.03 percent from P1.179 trillion in 2013, but were 7.72-percent below the target of P1.405 trillion.

Collections from non-BIR operations, on the other hand, dropped by 2.37 percent to P37.09 billion last year from 2013’s P37.99 billion, and 27.32-percent below the P51.03-billion goal.

This year, the BIR is tasked to collect taxes totaling P1.674 trillion, equivalent to a tax effort target of 11.8 percent.

The target collections from taxes on net income and profit amount to P993.577 billion; P373.831 billion from the 12-percent value-added tax or VAT slapped on a number of goods and services; P140.438 billion from excise taxes; P79.142 billion from percentage taxes; and P86.958 billion in other taxes.

The BIR had already slashed its original 2015 tax-collection goal of P1.721 trillion twice.

In January, the BIR lowered its target for this year to P1.704 trillion, citing the P16.9 billion in foregone revenues from the expanded exemption on workers’ de minimis benefits gained from collective bargaining agreement or CBA as well as productivity bonuses, as ordered by the Department of Labor and Employment last December.

Last month, the BIR again brought down its 2015 collections goal to P1.674 trillion, as the law signed by President Aquino that lifted to P82,000 from P30,000 previously the tax-exemption cap on 13th-month pay and other bonuses was seen to result into revenue leaks worth P26 billion-30 billion.

To achieve the BIR’s 2015 target, Henares had ordered the implementation of 27 priority programs, including affixing tax stamps on alcohol products.

Henares had said that the BIR was hoping to implement the Internal Revenue Stamps Integrated System (Irsis) for alcohol products and distilled spirits toward the end of the year.

This will entail affixing tax stamps on liquor—similar to an ongoing program on tobacco—to ensure the collection of correct excise taxes on alcohol products under the Sin Tax Reform Law.

Aside from Irsis on alcohol, the BIR’s other priority programs in 2015 are Online System for Transfer Tax Transactions; Electronic Certificate Authorizing Registration; Electronic Tax Information System; Run Against Tax Evaders or Rate program; Oplan Kandado program; Taxpayer Registration Information Update program; Online System for Accreditation of Importers and Customs Brokers; Online Application and Processing of Tax Clearance for Bidding Purposes; Electronic Official Registry Book; Automated Internal Revenue Allotment Computation System; Compliance Improvement Strategy; Geographical Information System; and Asset Information Management Program.

Also, among the BIR’s priority programs for this year are the Enhanced Mobile Revenue Collection Officers System; E-Linkage with the Bureau of the Treasury; Forfeited Asset Management; Integrity Management Program; Capacity Development and Public Awareness; Workflow Management System; Expansion of ISO Certification to Other District Offices; Exchange of Information program and the implementation of the Foreign Account Tax Compliance Act Intergovernmental Agreement Model 1; Human Resources Information System; Procurement, Payment, Inventory, Distribution and Monitoring System; Strategic Performance Management System; Transfer Pricing Program; and Industry Issues Resolution-Legal program.

According to Henares, Rate and Oplan Kandado have been “consistently among the top priorities, since these programs have a significant impact on the attainment of revenue goal.” Rate brings alleged tax evaders to court, while Oplan Kandado shutters establishments found deficient in paying the right taxes.