The Bureau of Internal Revenue (BIR) prefers to distribute the workload of its Large Taxpayers Service (LTS) group to the different revenue district offices (RDOs) for simpler tax collection.
Internal Revenue Commissioner Lilian Hefti said the agency has no plans to totally abolish the LTS because it was the brainchild of the International Monetary Fund (IMF).
She believes, however, that it would be practical to transfer some of the workload of the LTS to the different revenue districts. Hefti said this would be done until next year.
Hefti earlier ordered a reduction in LTS’ clients. From 1,289 clients previously, LTS now has less than 1,000 but over 800 clients.
The LTS group caters to large corporate clients including top 1,000 corporations in the country.
These clients are those with net worth of P300 million and pay an annual income tax and withholding tax of at least P1 million. They also pay value-added tax of at least P100,000 for any quarter and P1 million in excise tax per taxable year.
Because of the move, the LTS has been given a lower collection goal this year of P402.568 billion, or 6.35 percent below the 2007 collection goal of P429.855 billion, latest data from the tax agency showed.
With a collection goal of P402.568 billion this year, the division accounts for almost half of the BIR’s 2008 revenue target of P844.95 billion.
The move to delist some clients from the LTS group has been criticized by many large taxpayers.
Industry sources said being delisted from the group would mean that they would now have to deal with revenue regions and settle their taxes along with the smaller taxpayers.
This, they said, could take time and extra effort compared to the previous practice when they have one group focused on their needs.
BIR officials, however, are hoping that the move would result in a more efficient tax collection.
The BIR, is under pressure to meet collection goals.