BIR amends criteria for top withholding agents

MANILA, Philippines — The Bureau of Internal Revenue (BIR) has modified its criteria for the classification of the top withholding agents, in line with the Tax Reform for Acceleration and Inclusion (TRAIN) Law.

This is based on Revenue Regulations 7-2019, as signed by Finance Secretary Carlos Dominguez and Internal Revenue Commissioner Caesar Dulay, amending pertinent provisions of Section 2 under RR No. 11- 2018, specifically on the criteria for top withholding agents.

The said RR will take effect on June 29, 15 days after its publication.

Under the new guidelines, top withholding agents shall refer to those taxpayers with gross sales or receipts, or gross purchases or claimed deductible itemized expenses amounting to P12 million during the preceding taxable year.

The BIR said top withholding agents by concerned BIR officers shall be published in a newspaper of general circulation or posted in the BIR website.

“Taxpayers who are classified as top withholding agents prior to the effectivity of these regulations shall remain as such until failure to satisfy the aforesaid criteria and duly published as delisted from the existing list of top withholding agents,” it said.

Previously, the BIR defined top withholding agents as those who qualify under Revenue Regulations 1-98, as well as the top 20,000 private corporations and top 5,000 individuals under RR 6-2009.

Taxpayers identified and included as medium taxpayers and those under the Taxpayer Account Management Program were also classified as top withholding agents.

The BIR is targeting to collect P2.33 trillion this year, 19 percent up from last year’s actual collection of P1.96 trillion.

About P2.257 trillion of the amount is expected to be generated through BIR operations, while P73.21 billion is projected to come from non-BIR operations.

By tax type, P1.06 trillion of the total BIR target is seen to come in the form of income taxes, P506.83 billion in value-added tax, P400.51 billion in excise taxes, P112.37 billion from percentage taxes, and P177.45 billion from other taxes.

According to data from the Bureau of the Treasury, the BIR raised P204.8 billion in revenues last May, up 19.1 percent from P172 billion in the same month last year.

This brought the agency’s cumulative collections to P908.5 billion in the first five months of the year, 9.8 percent higher than the P827.7 billion recorded in the same period in 2018.