The Bureau of Internal Revenue remains optimistic of hitting its P1.829-trillion collection target but the tax chief says changes, including beefing up the agency’s workforce, are needed for this to happen.
“I have to be confident and I am hoping that we can look for a lot of areas where we can increase taxes,” Internal Revenue Commissioner Caesar Dulay told reporters in an interview during the bureau’s 113th anniversary on Wednesday.
The tax bureau netted P131.2 billion in June, up 6 percent year on year and resulting in a first half take of P848 billion — 8 percent higher compared to the same period in 2016.
Dulay said the BIR was aiming to achieve the revenue goal by increasing the number of taxpayers through a segmentation and tax mapping program.
However, the agency needs to hire more personnel to implement this, he said.
“To increase the taxpayers, we have to get them to register. That is why we need people to help us. We need employees to go and check the tax verification and to capture them into the tax net,” he stressed.
Dulay said the BIR workforce presently stood at just over 10,000, well below the 25,00 approved plantilla positions.
To close the gap, the tax bureau has asked Congress for an exemption from the Salary Standardization Law to attract applicants.
While the proposal remains pending, Dulay said the bureau would also look for other ways to increase the compensation of BIR employees.
Catch more ‘big fish’
For its part, the Department of Finance (DoF) said it had ordered the BIR to work closer with the Bureau of Customs (BoC) in catching more “big fish” that are cheating the government of billions of pesos in taxes.
This followed a successful campaign against cigarette manufacturer Mighty Corp., which the DoF said had resulted in the biggest tax haul ever from a single entity.
In last month’s State of the Nation Address, President Rodrigo Duterte ordered the DoF and the BIR to accept Mighty’s settlement offer of P25 billion, representing deficiency excise and income taxes, along with the voluntary shutdown of all its operations.
“You better line up another big one. Next year, if possible, catch somebody, another big fish,” Dominguez was quoted as having told Dulay and Customs Commisioner Nicanor Faeldon during a recent Finance department executive committee meeting.
Dominguez said another P20 billion or P30 billion would be “a good target” for the BIR and BoC in terms of running after tax cheats.
The government’s total take from the Mighty’s settlement offer is expected to reach P30 billion, Dominguez said, owing to the value-added tax to be paid from the sale of Mighty’s assets to Japan Tobacco International (JTI).
Dominguez attributed the success of the government’s campaign against Mighty to the close coordination and exchange of information between Dulay and Faeldon.
“We all work as a team. It’s not one or the other, it’s everybody together,” he said.
A manager’s check amounting to P3.44 billion, covering Mighty’s excise tax liabilities, was issued on July 20 by JTI and deposited at the Social Security System branch of the Land Bank of the Philippines in Quezon City. The amount represented the initial tranche of Mighty’s settlement offer.
The balance of P21.5 billion will be paid on or after the closing of the proposed deal with JTI, which still needs to be cleared by the Philippine Competition Commission.