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By Chino S. Leyco, Reporter
THE Philippines’ tax effort will decline next
year due to the scheduled reduction in the corporate tax rate, the
Department of Finance said.
Finance Undersecretary Gil S. Beltran said the
tax effort, defined as the share of taxes to the country’s gross
domestic product (GDP), will ease to 15.2 percent from the original
forecast of 15.4 percent.
The 2-basis points drop would be tantamount to a
P15-billion revenue loss from the 5-percent reduction in the
corporate tax rate next year from 35 percent at present.
Beltran said no bill was filed in Congress that
will suspend the implementation of the corporate income tax
reduction next year.
Despite the 5-percent cut, the government can
still manage to improve its tax effort in the years to come, the
finance official said.
In the first quarter this year, the country’s
tax effort improved to 15.05 percent, from 14 percent last year and
14.3 percent in 2006.
Arjun Thapan, Asian Development Bank (ADB)
director general for Southeast Asia, said the government is unlikely
to meet its fiscal goal next year without further improvement in its
tax effort.
Thapan said a further increase of about 2.5
percent of GDP is “needed to keep the fiscal reform agenda on
track.”
Government data showed that the tax effort had
declined after hitting a high of 17 percent in 1997 when the
Comprehensive Tax Reform Program was implemented.
BIR orders early audit for large taxpayers
To meet its collection target, the Bureau of
Internal Revenue (BIR), which accounts for at least 60 percent of
government revenues, wants to audit value-added taxes (VAT) remitted
to it in the first quarter of every year.
BIR Commissioner Lilian Lefti said payments made
by selected large taxpayers will be audited by the agency’s
investigating offices and immediate action taken on any delinquent.
Under Revenue Memorandum Order No. 22-2008,
Hefti said Letters of Authority shall be issued for large taxpayers
selected for audit. Similar letters shall be issued to cover the
audit of VAT liabilities of regional taxpayers.
Hefti said businesses with gross sales, revenues
or receipts exceeding P5 million for revenue regions Valenzuela
City, Manila, Quezon City and Makati City will be subject for audit.
Likewise businesses with gross sales, revenues
or receipts exceeding P2 million for all other regions, including
Romblon, Puerto Princesa City and San Jose, Occidental are also
included in the audit.
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