Gov’t misses 2018 collection goals from TRAIN
The government has failed to meet its target net revenues from new or higher levies slapped under the Tax Reform for Acceleration and Inclusion (TRAIN) Act during the first nine months of last year, even as Finance Secretary Carlos G. Dominguez III said the law benefited many Filipinos with P102.9 billion in tax relief thanks to lower, restructured rates.
The latest preliminary Department of Finance (DOF) data provided to reporters late Friday showed that the net revenue generated from the TRAIN law at end-September 2018 reached P41.9 billion, 5.3 percent below the P44.3 billion goal for the nine-month period.
From January to September, the government had collected P150.9 billion from the higher or new excise taxes on oil, motor vehicles, sugar-sweetened beverages and tobacco, as well as fewer value-added tax (VAT) exemptions, higher documentary stamp tax (DST) and improvements in the collections of financial and corporate income taxes.
But as the TRAIN law also gave relief to personal income tax payers and eased estate and donor taxes, foregone government revenue as of end September hit P108.9 billion.
Dominguez told reporters that while there was a shortfall, the net collection as of September was “not so bad.”
“I want to emphasize that the big number there was the reduction in income tax. [At P102.9 billion in the first nine months of 2018], or about P12 billion a month. That means individuals had actually additional spending power,” Dominguez said.
“So don’t look at only the collection—look at what was given up. And they were given up directly to individuals. This TRAIN law benefited directly individuals who were earning P250,000 a year, and even those who were earning less [than P250,000 yearly]. TRAIN has succeeded 100 percent in that regard,” he added.
DOF data showed that actual foregone revenue from the new personal income tax structure at end-September was below the P108.7-billion target for the period.
The lower losses from personal income tax cut was attributed by the DOF to “better compliance and an increase in jobs.”
The government exceeded targets for excise taxes on oil products, automobiles and tobacco and DST.
The DOF said the above-target excise collection from tobacco was “due to better compliance and advance production,” while the increase in DST take came on the back of “higher transactions value and better collection efficiency.”
However, collections fell short from excise tax on sugary drinks, VAT and financial taxes.
