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End-September net revenues under TRAIN law exceeds target

By: - Reporter / @bendeveraINQ
/ 12:01 PM December 23, 2019

MANILA, Philippines — The net revenues collected from new or higher taxes slapped under the Tax Reform for Acceleration and Inclusion (TRAIN) Law reached P91.3 billion as of September, surpassing the nine-month goal.

In a statement last Sunday, Finance Undersecretary Karl Kendrick T. Chua said actual end-September collections exceeded by 18.2 percent the P77.3-billion program for the period.

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As such, TRAIN Law’s tax-take during the first nine months already accounted for four-fifths of the P113.1-billion full-year target for 2019, Chua said.

On a year-on-year comparison, TRAIN net revenues at end-September jumped 107 percent.

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“This means we are now closer to completing the 2019 estimates, compared to where we were last year when we were trying to reach the 2018 estimates. This is definitely welcome news, especially for the infrastructure and human development objectives of TRAIN,” Chua said.

The Department of Finance (DOF) said the Bureaus of Internal Revenue (BIR) and of Customs (BOC) — the country’s biggest tax-collection agencies—both had excess TRAIN revenues worth P9.4 billion and P4.7 billion, respectively, during the nine-month period.

Excise taxes on imported oil, sugar-sweetened beverages, and tobacco as well as higher documentary stamp tax (DST) pushed collections up alongside narrower foregone revenues from personal income taxes despite lower rates under the TRAIN Law, resulting in a net gain of P42.4 billion, DOF said.

“One of the most significant provisions of TRAIN was the lowering of personal income taxes. Losses from this adjustment were originally estimated at P96.4 billion, but actual losses were lower at P79.2 billion, or a savings of P17.2 billion. This was a result of better compliance, higher employment rate resulting in an increase in registered taxpayers, and lower unemployment and underemployment rates,” Chua said.

According to Chua, end-September collections from excise taxes slapped on oil imports exceeded the target by P14.3 billion; on sugary drinks, P1.9-billion above goal; on tobacco, P4.4-billion above target; and DST earnings were above the goal by P4.7 billion.

However, DOF said collections from locally refined oil and motor vehicles fell below target by a combined P25.2 billion.

“The excise tax collections from locally refined petroleum products were short by P13.9 billion because of the decline in the volume of removals and the shift to imported finished products,” Chua explained.

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Meanwhile, “automobile excise tax earnings were short by P11.3 billion owing to lower import volume,” according to Chua.

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TAGS: BIR, Business, business news, local news, News, Philippine news updates, revenue, September 2019, tax, TRAIN Law
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