BIR collects P7 billion back taxes from evaders

MANILA, Philippines — The Bureau of Internal Revenue (BIR) has raised more than P7 billion worth of back taxes from individuals and firms who tried to run away from their financial obligations to the government.

The BIR yesterday reported that it filed a total of 137 cases to go after P4.39 billion in aggregate liabilities through the Run After Tax Evaders (RATE) program last year.

When compared to 2020, the BIR pursued 181 lawsuits before the Department of Justice (DOJ) and the Court of Tax Appeals (CTA) to regain P8.2 billion in back taxes from evaders.

The BIR said Oplan Kandado collected P2.95 billion by shutting down 523 business establishments found breaching several provisions of the Tax Code. The performance improved when compared to a year earlier, when the BIR just raised P607.87 million on 209 closures.

As the lead agency for the RATE program, the BIR presses charges before the DOJ and CTA to compel tax evaders to pay up their financial dues. As the name suggests, the RATE prosecutes individuals and firms engaged in tax evasion, tax fraud and similar violations under the law.

On the other hand, the BIR launched Oplan Kandado in 2009 with the objective of closing down business establishments violating fiscal laws and recovering losses incurred to tax leakages.

The BIR slaps administrative sanctions, including suspension of business permit and temporary closure of the stores, against owners to make sure they remember to comply in the future.

Likewise, the BIR reported that it generated P4.97 billion from the tax amnesty program, as well as P883.29 million from the voluntary assessment program, in 2021.

In 2019 President Duterte signed Republic Act (RA) 11213 allowing individuals with tax liabilities from 2017 and before to apply for tax amnesty. Similarly, the law provided taxpayers a one-time opportunity to settle their estate taxes for properties of a deceased person who died on or prior to Dec. 31, 2017.

The law was scheduled to expire in 2020, but the second Bayanihan law extended it up to June 30, 2021. Afterward, the President signed RA 11569 to prolong the program for two more years until June 14, 2023.

In spite of the challenges posed by the pandemic, the BIR said it managed to raise revenues for the government by expanding the taxpayer base and introducing digital reforms.

Last year taxes collected by the BIR grew by more than six percent to P2.08 trillion, from P1.95 trillion in 2020, on the resumption of economic activities that fueled additional payments.