BIR warms up to Russian tax digitization proposal

THE Department of Finance (DOF) has directed the Bureau of Internal Revenue (BIR) to pursue its discussions with the Russian government to improve tax administration in the Philippines.

Manila and Moscow tax officials will conduct a second round of talks particularly in efforts to help the Philippine digitalize tax administration.

“[Top officials of the Federal Tax Service (FTS) of Russia] will gladly support us and help us on our automation or digitalization programs,” Internal Revenue Deputy Commissioner Arnel SD. Guballa said.

Officials of the BIR and the FTS last met online in January to discuss best practices that could be applied in the Philippines to further improve tax administration and compliance.

BIR officials also raised with FTS Deputy Commissioner Dmitry Volvach the possibility of a bilateral cooperation agreement between both tax authorities.

The DOF requested then outgoing Russian Ambassador Igor Khovaev in February last year for assistance in helping the BIR set up a tax data capture program for its value-added tax collection effort that is similar to Russia’s highly efficient system.

At that time, Ambassador Khovaev said that Russia has shared its VAT collection technology with other countries and would assist the BIR in its effort to improve its system.

One-stop shop

IN a separate statement, the BIR said its launch of the first phase of its Central Business Portal (CBP) will make it easier to register a business in the Philippines.

The CBP is an online system which offers a single site/one-stop shop for all business-related information and transactions, such as registering a corporation, registering business and securing business permits/certificates, licenses from said government agencies.

Under Phase 1, the CBP shall be available to the domestic corporations, particularly one-person corporations, corporations with two to four incorporators; regular corporations whose incorporators are juridical entities and/ or the capital structure is not covered by the 25 percent-25 percent rule.

Commissioner Caesar R. Dulay expressed his optimism that with the recently-launched online registration platform, more taxpayers will find it easier and faster to comply with registration requirements of the government.

“It will put delays, bureaucratic gridlocks and inefficiencies a thing of the past. It will likewise put more taxpayers into the tax net thereby strengthening revenue collection efforts and eventually pump more lifeblood into the veins of government operations,” the Commissioner said.

The Bir-related features of the CBP are online generation/issuance of Taxpayer Identification Number of new corporations; identification of the national internal revenue taxes which the new corporations will be liable to; online payment of the annual registration fee (ARF) of P500 and loose Documentary Stamp Tax (DST) of thirty pesos (P30); and generation of BIR Electronic Certificate of Registration (COR).

BIR said the electronic COR bears a Quick Response Code that serves as a security feature to prove authenticity of the COR.

New corporations registering through CBP are likewise given an option to pay ARF and loose DST manually. However, when they choose this option, they shall complete its business registration at the respective Revenue District Office by submitting the printed Cbp-generated documents, and other documentary requirements prescribed by the BIR in its Revenue Memorandum Circular 15-2021 issued on January 27, 2021.