The Philippine government should develop a tax billing system that would do away with voluntary tax compliance in order to ensure everyone pays their respective taxes, said Stephen Roger, executive director for Asia Pacific Region at BKR International.
Roger told The Manila Times that more and more countries—including India, China, Australia and New Zealand—were considering a tax collection system that would unburden its taxpayers from having to file their income tax returns (ITR) and pay the corresponding dues.
“All governments around the world are looking at improving their tax administration.
Among the measures that are being developed is the so-called tax billing system, wherein taxpayers need not lodge their respective income tax returns and would only have to pay the taxes being billed to them by their respective governments,” Roger said.
A tax billing system would ensure compliance as taxpayers would simply have to wait for their respective bills at home or in the office, and pay as if settling utility bills.
Roger noted that the said countries were in the process of beefing up their taxpayer databases, through which incomes are being monitored.
“The revenues generated by these taxpayers, including those income derived from dividends, wages, interest earnings are all being reported electronically by the payors to their respective tax agencies, so it is easier to determine as to how much each taxpayer has to pay,” he said.
“It is not impossible for the Philippines to do the same. If China, Australia, New Zealand and even India can do it, then with more reason that the Philippines can do it,” Roger added.
BKR International is one of the top 10 global accounting associations, representing the combined strength of more than 160 independent accounting and business advisory firms in over 500 offices and 80 countries.
Roger recently visited Manila to attend the annual BKR Asia Pacific Board Meeting, which was hosted by Alas Oplas & Co., CPAs, its sole accounting member firm in the Philippines.
Presently, the government through the Bureau of Internal Revenue (BIR) observes the “voluntary compliance” approach. This means that taxpayers, whether corporations or individuals, have to register as taxpayer, file an ITR and pay the tax due.