The Bureau of Internal Revenue (BIR) said that they will strictly implement tight estate tax collections as they projected to collect P50 billion worth of estate tax by 2016.
BIR Commissioner Kim Henares said that the bureau are still finalizing their annual targets by 2014 but is set on their gears to achieve the P50 billion 2016 target.
“We will strictly monitor the transfer of estate to collect the tax due. We are targeting to collect P50 billion from now up to 2016,” Henares said.
Estate tax is the levy imposed on beneficiaries of the deceased person’s wealth and properties. Annual excise tax collected reach only from P850 million to P1 billion at the most in the past years.
The bureau said that they strictly collect the duties as people tend to cheat to run away from their due taxes.
Henares said that along with the excise tax collection target, the bureau would want the people to “become rich:” the more they do, the more they pay taxes. She explained that higher income translates to more income tax duties and when they die, it automatically translates to added excise taxes.
On the other hand, Finance Secretary Cesar Purisima expressed that the long term P50 billion goal is attainable.
Henares said that the target is also likely as “property values increase, people get richer…[and]estate taxes will increase” with it.
She also said that they have coordinated with the National Statistics Office beforehand for the records of death certificates, as well as with the banks to monitor flow of assets and deposits as the bank secrecy law is not applicable to be imposed on the deceased people and the excise tax.
The Bank Secrecy Deposits Act prohibits inquiry or disclosure of any kind of deposit transactions made with banks and financial institutions.
“I made a statement earlier that the bank secrecy law do not apply to estate taxed, so we started asking for statements from banks [and financial institutions]. That is a new procedure ongoing as of the moment,” Henares said. KRISTYN NIKA M. LAZO