Finance Secretary Carlos G. Dominguez III has ordered the Bureau of Internal Revenue to expand its list of large taxpayers, as the country’s biggest tax-collection agency eyes to sustain the double-digit growth in collections posted in January.
“As of 2016, there are 2,320 large active taxpayers registered to the LTS [BIR’s large taxpayers service]. These registered large taxpayers account for 61 percent of the total BIR collections. I find the number of registered large taxpayers rather small considering the rapid expansion of our economy,” Dominguez said late Monday.
“The first task for the LTS is to seriously review and update the registry of large taxpayers. If we are able to significantly add to the number of large taxpayers supervised by the LTS, I am sure that we can increase the tax effort equally significantly,” Dominguez said.
The Finance chief said “whatever the criteria for qualifying large taxpayers may be, I am sure that many who should be in this registry managed to stay out of it.”
As such, Dominguez said he had ordered the BIR to “go out and find the other large taxpayers who have managed to avoid the registry.”
“Those potential large taxpayers will enable us to better meet our collection targets and demonstrate not only significant, but also substantial improvements in our tax effort,” according to Dominguez.
In response, BIR Commissioner Caesar R. Dulay said the agency was targeting to raise the number of large taxpayers to 3,000 within the year.
“We are working on it but I signed some papers already advising some taxpayers that we have identified them to start reporting under the large taxpayers service,” Dulay said.
In 2016, the LTS collected a total of P963 billion from the country’s 2,320 biggest corporations, missing the adjusted P1.004-trillion target.
The LTS’ 2016 take nonetheless grew 9.3 percent from 2015’s P881 billion.
As early as 2015, the BIR already targeted LTS collections breaching the P1-trillion mark, but failed. For the third straight year, the BIR will try to collect taxes worth over P1 trillion from large firms in 2016. The actual target for this year is P1.105 trillion.
The BIR defines large taxpayers as corporations with authorized capitalization of at least P300 million registered with the Securities and Exchange Commission; multinational enterprises with authorized capitalization or assigned capital of at least P300 million; publicly listed corporations; universal, commercial and foreign banks; taxpayers with an authorized capitalization of at least P100 million belonging to the banking, insurance, petroleum, telecommunications, utilities, alcohol and tobacco industries; and corporate taxpayers engaged in production of metallic minerals.