'Tax collection still needs to be improved' - DOF

MANILA, Philippines - Despite the good economic performance of the Philippines in recent quarters, tax collection still needs to be improved, Finance Secretary Cesar V. Purisima said in his closing remarks at the Philippine Economic Briefing held in Manila on Wednesday.

Purisima said the bureaus of Internal Revenue and Customs should increase their tax effort to 16 percent from the present 13 percent and revenue effort to 18 percent from the present 14.7 percent.

He added that of the 1.5 million self-employed individuals in the countries, only 500,000 filed tax returns last year.

"If we're able to increase their average tax payments to P200,000 that's an additional 3 percent of GDP (gross domestic product)," Purisima said.

He also appealed to the wealthy to be honest in filing their estate tax collection as collection for the past 10 years remained flat despite increase in asset prices.

"At the Bureau of Customs, we appeal to the exporters and importers to pay the right amount of duties and taxes. Customs collections the past year declined as a percentage of GDP but we will work closely with you to make sure we’re able to collect the right amount of taxes," Purisima added.

Still, Purisima said the Philippines is a "success story built on a simple premise that good governance is good economics."

"Who would have imagined two and half years ago that the Philippines could be one of the growth leaders in a global economy confronted with gloom?  Who would have thought that within the past two and a half years, we have erased almost a decade’s worth of credit ratings decline and we are now at the doorstep of investment grade? Who would have dreamed that there will come a day when the glimmer of hope for Mindanao to reach its full potential shall shine as bright?   Who would have dared to implement reforms that have for years been in the back-burner for lack of political will and support such as the RH bill and sin taxes?" Purisima said.

The Philippines has been tagged by the World Bank as a rising tiger following the  6.6-percent growth in 2012. An upgrade on the country's credit rating outlook to investment grade is also expected within the year.