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THE Department of Finance (DOF) is banking on a more efficient and streamlined tax system and better inflation to hit the state’s goal of collecting a record-high of P4.3 trillion in revenues this year, as it is tepid in pushing for new taxes this year.
Finance Secretary Ralph G. Recto stressed on Wednesday that the DOF will not push for new taxes this year as the Bureaus of Customs and Internal Revenue would depend on better performance to generate funds for the state. Recto confirmed that earlier proposals to impose taxes on junk food and higher sweetened beverage tax and other consumption-based taxes are now off the table.
Recto pointed out that passing new taxes might be burdensome to the Filipinos amid the current inflation climate of the country.
Given this situation, Recto said the BIR and BOC would optimize their performances through “creativity, transparency, and efficiency” in tax and customs administration.
“In the immediate term, inflation has to be tamed decisively and kept at bay. Ensuring that prices of goods remain stable and affordable is crucial to further grow the economy, consequently enabling us to boost revenue collection,” he said in a joint press conference with BIR and BOC on Wednesday.
“I strongly urge the BIR and BOC to work together as a team in ensuring the ease of paying taxes and eliminating trade barriers that severely impact our supply chains,” he added. This year, the BIR is tasked to collect about P3.05 trillion in revenues while the BOC aims for P1 trillion in earnings.
He advised the BIR, the state’s internal revenue collector, to expedite the implementation of the Ease of Paying Taxes Act to ensure that taxpayers receive value for their contributions by fulfilling its “promise of prompt, efficient, and excellent taxpayer service.”
He added that the BIR must run after tax cheats and bring action against them in the court.
“This administration will intensify its campaign for tax compliance in a fair manner that favors no one,” Recto said.
Taxpayer education
BIR Commissioner Romeo Lumagui Jr. said the bureau will intensify taxpayers’ education to improve “tax compliance” by the Filipinos.
The BOC, meanwhile, must channel all efforts towards significantly enhancing trade facilitation and strengthening border control to curb smuggling, Recto said.
Recto said the BOC is working to implement an integrated system for pre-border verification and invoicing to reduce smuggling and misdeclaration.
“The BOC should do everything in its power to shore up our defenses from the infiltration of illegal drugs, substandard products and other harmful commodities,” he said. BOC Commissioner Bienvenido Y. Rubio said the bureau will enhance its Enhanced Value Reference Information System (e-VRIS), which determines whether the declared value made by the importer represents the transaction value when sold for export to the Philippines, to improve its collection efficiency.
Rubio added that the BOC will strengthen its border control by engaging and collaborating with other law enforcement agencies to protect the goods passing through the ports as well as streamlining its processes through digitalization.
Digitalization
RECTO, who was appointed as Finance secretary last January 15, added that digitalization would remain a priority of both the BOC and BIR in improving their collection efforts. “To ensure the utmost efficiency in revenue generation, both the BIR and the BOC must safeguard the integrity of their operations by putting an end to corruption,” he said.
“In addition, digitalization is key to achieving a truly modern and more effective governance. I urge the BIR and the BOC to accelerate their digital transformation programs and embrace constant innovation. By continuously improving the way we do things, we will better serve our nations,” he added.
No new taxes this year
RECTO reiterated that he will not push for new taxes this year that would be burdensome to the public and cause inflationary pressures.
“As to imposing new taxes, frankly speaking, there are no plans of imposing additional new taxes. I think our first job is to collect what is on the table,” he said.
“And that is why we are planning with the BIR and the BOC to improve [their] efficiency. How do we collect more from the current taxes imposed in the tax code?” he added.
Nonetheless, Recto pointed out that he would continue to pursue and “refine” the tax proposals started already by the DOF.
“We are tweaking them because I think now that the inflationary environment is a bit high, [and] sometimes [if] you impose additional taxes, it is inflationary as well. So, the fine-tuning will be on what is fairer, what is easy to collect and what is practical,” Recto said.
Recto also disclosed that one of the tax proposals they are tweaking is the proposed road users tax to make it less burdensome to motor vehicle users since they already face multiple taxes such as excise and value-added tax.
Image credits: Facebook.com/DOFPH
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