BIR eyes P258 B from individual taxpayers

MANILA, Philippines - The Bureau of Internal Revenue is eyeing to raise P258.14 billion from individual tax collections this year, up 16.4 percent from P221.77 billion in 2012 as it steps up its campaign against tax evasion.

The bulk of government’s individual income taxes, which currently account for more than a fifth of BIR’s total revenue collections, comes from salaried individuals whose taxes are automatically withheld by employers.

The BIR, which accounts for three-fourths of state revenues, surpassed the P1 trillion collection mark as of Dec. 17.

To boost tax collections, the agency is going after online sellers amid the growing number of online transactions.

According to the BIR, the incidence of tax evasion among the country’s three million registered professionals is high. Around 190,000 are doctors and lawyers who charge higher fees and have higher incomes.

BIR deputy commissioner Estela V. Sales, however, is hopeful that the agency’s Run After Tax Evaders or RATE program, which made significant gains last year, will continue to encourage people to be vigilant and report those who do not file and pay the correct taxes.

The Aquino administration has filed 140 tax evasion cases since the start of its term – 107 against smugglers and 59 erring employees.

The agency scored its first major victory against tax evaders last year when the Supreme Court affirmed the Court of Tax Appeals’ conviction of Gloria Kintanar,  a former multi-millionaire distributor of multi-level marketing firm Forever Living Products.

Kintanar’s tax evasion case is a huge win because of the “willful blindness” ruling that was affirmed by the High Court.

Under the “willful blindness ruling,” taxpayers can no longer blame their accountants for their fraudulent returns.

 Also convicted for tax evasion was her husband, Benjamin.

 â€œWe’re proud of our accomplishments. In the past, the agency’s batting average at the Department of Justice was dismal if you look at the number of cases that actually make it to the courts. Now, the increase in the number of cases that reach the Court of Tax Appeals is much higher,” Sales said.

With the passage of the sin tax reform bill, the BIR expects to collect an additional P134 billion in the first year alone as well as P184.31 billion in the next four years. This translates to a yearly average of P43 billion in incremental revenues from excise tax on the so-called sin products.