The Bureau of Internal Revenue AFP FILE PHOTO
“Sheer hard work” drove tax collections in July past the state’s ambitious tax target for the first time this year, Revenue Commissioner Kim Jacinto-Henares said on Thursday.
Collections by the government’s top moneymaker grew by nearly a fifth or just slightly more than the agency’s goal for the month. Tax collections for the January-July period were still behind the seven-month target.
“It was sheer hard work,” Henares said in an interview, describing how the agency exceeded its collection goal.
Asked whether the growth in revenues could be sustained, she said, “I hope so.”
The higher collections of the Bureau of Internal Revenue (BIR) would allow the government to accelerate spending to prop up economic growth. For this year, the government hopes to hike infrastructure spending to the equivalent of 3.1 percent of gross domestic product (GDP) from just 1.8 percent in 2010.
Damage caused by Supertyphoon “Yolanda” and other natural calamities in the second half of last year also made higher spending more urgent.
Even as it hikes spending, the government wants to keep its budget shortfall this year to 2 percent of GDP—a level that officials consider “sustainable.”
For the month of July, the BIR collected P119.94 billion in revenues—19.82 percent more than that reported in the same month last year. The collection exceeded the goal set for the month by P58.52 million, or 0.05 percent.
After lagging for several months, collections of the BIR’s Large Taxpayers Service (LTS) rose by 25.05 percent. LTS collections, which made up bulk of the total, cover payments made by big corporations.
Collections by regional offices rose by 15.12 percent in July, with the total falling short of the goal by 4.89 percent.
For the whole year, the BIR hopes to collect P1.46 trillion in taxes, or 16.6 percent higher than that of 2013.
Because of its fine performance in July, the BIR noted a recovery in collections, which grew at more modest paces in the first half of this year despite efforts to encourage more people to be honest with their taxes.