The Department of Finance (DOF) said that, were it not for rampant tax evasion in the business sector, there would be more “large taxpayers” in the country, even double than that on the existing list.
Finance Secretary Cesar Purisima said that, at present, there were a little over 2,000 enterprises on the Bureau of Internal Revenue’s list of “large taxpayers.”
The finance chief said that, assuming full tax compliance in the business sector, there should be at least 4,000 enterprises in that particular category.
“I am sure there are over 2,000 companies out there that are not captured by the Large Taxpayers Service (LTS) of the BIR. Let us get them out to the visible world,” Purisima said in a speech during an award ceremony for large corporate taxpayers.
He lauded the LTS for the 16-percent year-on-year growth in collections last year to P755 billion. The unit accounted for 62 percent of the BIR’s total tax collection last year.
Under BIR rules, a large taxpayer is one that has a quarterly value-added tax payment of at least P200,000, quarterly percentage tax payment of at least P200,000, annual excise tax payment of at least P1 million, annual income tax payment of at least P1 million, annual withholding tax remittance of at least P1 million, and annual documentary stamp tax payment of at least P1 million.
Industries that help drive economic growth should take the lead in terms of growth in tax payments, Purisima said.
He cited the real estate and construction sector, which helped drove economic growth last year but registered lower tax payments. Data from the DOF showed that construction grew by 11.1 percent in 2013, but combined tax payments of industry members dipped by 7.5 percent to P5.5 billion.