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By Chino S. Leyco Reporter
THE Bureau of Internal Revenue (BIR)
has extended, as well as expanded the coverage of this year’s tax
amnesty program to allow more people to avail of it.
BIR Commissioner Lilian Hefti
said that this allows taxpayers with capital deficits to benefit,
adding it will help raise additional revenues.
She said this was available
earlier, but only to those taxpayers with a positive net worth.
“Companies in a deficit
position can likewise avail of the tax amnesty provided amendments
to the balance sheet shall be made, resulting [in a] reduction in
the reported deficit,” Hefti said.
She also said the resulting
deficit will serve as a basis for computing the 5-percent amnesty
tax rate.
“Amnesty tax payable is
whichever is higher between the resulting figure after applying the
five percent on reduction in capital deficit or the prescribed
minimum absolute amount,” she said.
Department of Finance Order
29-07, which lists the implementing rules and regulations of
Republic Act 9480 or the Tax Amnesty Law, prescribes varying amounts
for different taxpayers.
The BIR proposed the expansion,
to aid taxpayers in the red but with good intentions of meeting
their respective tax obligations.
The agency commenced last
September the six-month amnesty program which covers all national
internal revenue taxes the government imposed for taxable year 2005
and prior years, with or without assessments duly issued, that
remained unpaid as of December 31, 2005.
Parties qualified to avail of the
2007 tax amnesty are individuals—both residents and non-resident
citizens and aliens—corporations, estates and trusts, cooperatives
and tax-exempt entities that became taxable as of December 31, 2005.
Likewise covered are other juridical entities including
partnerships.
Asset sales not good long-term
strategy
The government is hard-pressed to
improve its tax collection efforts, in the face of criticisms over
its dependence on asset sales to prop up its revenues.
In a study, the Economist
Intelligence Unit (EIU) said the govern-ment’s plan to sell more
assets next year cannot be a long-term strategy in its effort to
wipe out its budget deficit.
“Relying on privatization
receipts is hardly a long-term strategy for the government, since
once an asset has been sold it will provide no further income,”
EIU said in a report.
It said that without several
divestments this year, the target would have been missed by an even
larger margin due to poor levels of tax collection.
In the first 11 months, the
government sold P90.6-billion worth of assets, including a
controlling stake in the country’s largest geothermal energy
producer, the sale of which raised P47 billion.
Finance Secretary Margarito B.
Teves said that next year, the government will continue its
privatization drive but expects to generate only P30 billion.
Revenues will come from the sale
of a sprawling property of Food Terminals Inc. in Taguig City, a
12-percent shareholding in distributor Manila Electric Co., and real
estate in Fujimi, Japan.
The government had hoped to
balance its budget by next year. With the expected decline in asset
sale proceeds, the BIR and Bureau of Customs have to take up the
slack and raise enough revenues to plug next year’s funding gap.
A balanced budget is expected to
raise the country’s credit rating, which in turn would open the
doors to low-cost funds abroad.
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