Bureau of Internal Revenue (BIR) Commissioner Kim Henares said that with the Department of Finance’s new accreditation system, the BIR will take over accrediting phase of importations done with the Bureau of Customs (BOC) which will ensure the legality and the consistency of importers in their businesses and their income taxes.
In a phone interview, Henares told The Manila Times that the BIR’s role in the new regulation is “to eliminate dummy corporations that were vanishing into thin air” when it comes to paying their respective income taxes.
When asked about government targets in reducing smuggling through the new system, the BIR commissioner said that the tax bureau is “only helping” the DOF and the BOC in tracking nontaxpayers and smugglers.
She said that the issue of stopping the recurrent smuggling in the country “should be answered by the Customs bureau.”
In the new accreditation system, the BIR is entitled to keep database of importers, and check whether or not they are filing their income taxes regularly or not.
Earlier, Finance Secretary Cesar Purisima said that the regulation would contain two measures, the first of which would be the BIR database to keep in track of “importers doing legitimate business and whether they are paying the right taxes.” The second would be to track the foreign goods dispatched by BOC being under post-entry audit by Fiscal Intelligence Unit (FIU) of the DOF.
The two measures would be carried out by the BIR for accreditation, and DOF-FIU for post-entry audit compared to the previous post-audit Customs team, which is now abolished.
Purisima admitted that with the recorded P700-million BOC post-audit revenues for imported goods last year, an estimate of P200-billion potential BOC revenues were lost because of smuggling.
“This [P700 million] is a miniscule amount compared to the foregone duties and taxes lost to smuggling every year. This year, we plan to substantially increase collections from our audits,” Purisima said.