BIR’s 2016 target set at P2 T

MANILA, Philippines - The Bureau of Internal Revenue is under pressure to collect more than P2 trillion by 2016 as the government is pressed to invest more in infrastructure and social services to achieve sustainable inclusive growth.

Finance Secretary Cesar Purisima wants the BIR to generate revenues of P2.07 trillion by 2016, 20.35 percent higher than the projected P1.72 trillion for next year.

Purisima said the higher targets set for the BIR was due to the need to substantially shore up spending on  infrastructure and social services to enable the Philippines to compete head on with its Asian neighbors.

He also wants the BIR to increase its tax to GDP (gross domestic product) ratio to 16 percent from the current 13.3 percent.

“The Department believes that the following reforms can allow the Bureau to harness its growth potential over the next few years,” Purisima said.

Public infrastructure spending currently stands at less than three percent of the country’s total economic output, below Southeast Asia’s average of five percent.     

Purisima said he believes that the collection targets are achievable as the BIR has launched an aggressive campaign to run after tax evaders across all sectors of the economy.

He said the BIR’s continuing efforts to use third party information such as utility bills data and registration data from other agencies would also help widen the tax net.

Internal Revenue Commissioner Kim Henares said increasing the tax take to P2 trillion would be a toll order but vowed to do to her best in going after more delinquent taxpaying individuals and corporations.

Last year, BIR collections grew 15 percent to P1.22 trillion.  Tax effort, an index measure of how well a country is doing in terms of tax collection relative to what could be reasonably expected given its economic potential, also improved to 10.54 percent from 10.04 percent.

Henares said there is still much to be done to plug revenue leakage due to tax evasion.

She said tax evasion remains prevalent among big corporations and the self-employed sector, dragging down state revenues.

To achieve its collection goals, the BIR will continue to implement revenue-generation measures which include the regular filing of tax evasion cases with the Department of Justice every two weeks.

So far, more than 270 tax delinquency cases have been filed with the Department of Justice under the leadership of Henares.