The Bureau of Internal Revenue (BIR) posted a 6 percent year-on-year increase in revenue for June but still missed its tax collection target for the month due to a worse-than-expected slowdown in private business activity and government spending.
Data released by the BIR on Friday showed the agency collected P94.12 billion in tax revenues in June, up P5.26 billion or 6.04 percent from the year-earlier level, but the amount fell short of the month’s P107.4 billion collection target by P13.28 billion or 12 percent, despite increases in all accounts.
A breakdown of the June tax revenue figure shows that collections from BIR operations, or regular tax revenues, reached P91.63 billion, higher by 6 percent or P5.35 billion from the amount collected in June 2013.
Non-BIR operations’ collections, such as taxes imposed on government securities sold by the Bureau of Treasury, stood at P2.49 billion, up a slight 0.52 percent or P12.85 million from the comparative year-earlier period.
Collections by the BIR’s regional offices surged 12.74 percent to P34.92 billion, or P3.95 billion more than the collections made in June 2013.
The BIR traced the lower-than-expected growth in tax collection to a slowdown in government spending and business activity due to delays in the release of business goods from Manila’s congested ports.
Audit due on large taxpayers’ VAT
Large taxpayers accounted for P56.71 billion of the collections, up by P1.4 billion or 2.53 percent.
The bureau stressed the need to closely monitor tax compliance among the Large Taxpayer Service sector, especially with regard to value-added tax (VAT).
“To this end, the Commissioner of Internal Revenue have instructed the Large Taxpayers Service (LTS) headed by Officer-in Charge-Assistant Commissioner of Internal Revenue Nestor Valeroso to conduct an intensive audit of the returns filed by the large taxpayers including but not limited to their value added tax returns,” it stated.
The BIR explained that the VAT Audit Group of the LTS has been reinvigorated and will work full-time in implementing quality short VAT audits to correct taxpayer errors and detect violations with the end in view of improving VAT compliance.
“The LTS [has been]instructed to specifically look into the tax compliance of the financial and insurance sector. The LTS was also instructed to assist in the filing of tax evasion cases if so warranted,” it added.
The BIR did not, however, identify any potential cases or suspected issues with specific taxpayers.
From the first half of the year, the BIR collected P643.21 billion, P49.5 billion or 8.34 percent more than the collections made in the first half of 2013.
For full-year 2014, the bureau is aiming to collect about P1.456 trillion, raising the target amount from the 2013 target of P1.253 trillion by 16.2 percent or P203 billion.