At the start of the lockdown last year, businesses had to close down, except for those considered as essential. It was probably only during the third quarter of last year when momentum picked with the re-opening up of the economy and with more business activities allowed to resume.
Despite the lifting of the enhanced community quarantine (ECQ), many micro and small and medium enterprises (MSMEs), which account for 99.5 percent of business establishments in the Philippines that employs about 63 percent of the country’s workforce and contributes around 40 percent of the gross domestic product, still found themselves either temporarily closed or operating at decreased capacity, according to a United Nations report in October 2020.
Without employment and normal business activities, tax collections will naturally go down. This is the reason why the Development Budget Coordination Committee had to reduce tax collection projections by the Bureau of Internal Revenue to only P1.68 billion.
Inspite of the difficulties, BIR’s tax collection still reached P1.94 trillion in 2020. While it is 11.23 percent lower than the previous year’s P2.19 trillion, the tax collection is 15.14 percent higher than the revised goal of P1.68 trillion.
BIR Commissioner Caesar Dulay, who is given the unenviable task of raising funds for the public coffers, attributed this to several factors, namely improved tax collection system through digital payment, improved tax collection in the big taxpayers section, and tax payments collected from POGOs.
As more Filipinos shifted to contactless transactions due to the lockdown, a total of P1.67 trillion or 86 percent of the BIR’s total collections last year was coursed through digital payment channels. Of this, around P4.98 billion was collected through mobile wallet PayMaya, which was launched last year as the latest addition to BIR’s digital payment options.
Meanwhile, about 21.5 million or 94 percent of the 22.86 million tax returns filed last year were also submitted online.
With many Filipinos finding themselves unemployed, they resorted to becoming mostly online entrepreneurs. This is probably the reason why there was a 6.15 percent increase in the number of new business taxpayers who registered with the tax agency. BIR data showed that 4.37 million business taxpayers registered with the agency in 2020, up from the 4.11 million new business taxpayers recorded in 2019.
The BIR also reported that tax collection from POGOs increased by 11.71 percent to P7.18 billion from about P6.4 billion in 2019. In 2018, collections from this sector was only P2.36 billion. The increase is attributed mainly to a BIR ruling mandating POGOs and service providers to first pay their tax dues before they are allowed to resume operations during the quarantine.
Dulay expressed optimism that the BIR would be able to perform strongly this year as he cited the Bangko Sentral ng Pilipinas’ pronouncements that the Philippines was already on its path toward recovery. For this year, the BIR is targeting to collect P2.081 trillion, 7.27 percent higher than collections in 2020.
And with the Asian Development Bank (ADB) expecting the Philippine economy to contract by 7.3 percent in 2020 before growth returns to 6.5 percent in 2021, there is much room for optimism.
New app
The Philippine Charity Sweepstakes Office, in partnership with Minedomain, is set to launch Birthday Panalo, a free and easy-to-use application with an entertaining game that will allow Filipinos to celebrate important dates in their lives, like anniversaries and birthdays, with exciting cash prizes.
While the app mainly targets millennials, Minedomain IT officer Seaver Choy said ease of use is one of the main factors their team considered in developing Birthday Panalo to make it enjoyable for users across various age groups.
The Birthday Panalo app, which can be downloaded free via Google Play Store and the Apple App Store, was developed by an all-Filipino team composed of professionals from schools such as De La Salle University, Polytechnic University of the Philippines and University of the East.
Choy assured users of the app that their personal data and information would be protected according to industry standards. The app had been tested by local and international cybersecurity companies like GLI, Bolton Labs, and Mantua, among others, to ensure that it has the needed safety measures in place to avoid leakage of user data.
Kapanalo or users of the app can place a bet on a three-part number combination consisting of a month, a day, and a year. A user can bet as low as P10 and win as much as P100,000. The bets can be paid via mobile wallet platforms like GCash and PayMaya, while winners may claim their prizes at the PCSO main branch or have it credited to their mobile wallets.
Soon, the Birthday Panalo game can be played in select PCSO outlets nationwide.
Not so hidden agenda