• BIR tax effort rises in 2017

The Bureau of Internal Revenue (BIR) said yesterday its tax effort rose to 11.26 percent of the country’s gross domestic product (GDP) in 2017 amid higher collections and greater cooperation of taxpayers.

In a speech before the Tax Management Association of the Philippines (TMAP), Internal Revenue Commissioner Caesar Dulay said the BIR’s tax effort in 2017 settled at 11.26 percent, higher than the 10.8 percent recorded in the previous year.

Tax effort refers to the ratio of the government’s tax collections in relation to the country’s gross domestic product (GDP).

This was also higher than the 10.5 percent to 10.9 percent average tax effort seen by the BIR in the past five years, Dulay said.

“For the past five years, the (tax effort) average was 10.5 percent to 10.9 percent, but for 2017 we recorded a tax effort of 11.26 percent, thanks to the cooperation of taxpayers,” Dulay said.

For 2017, the economy grew 6.7 percent, slower than the 6.9 percent growth recorded in 2016.

On the other hand, revenue of the BIR last year amounted to P1.779 trillion, up 12.92 percent from the P1.576 trillion.

This also represents a 97.27 percent accomplishment rate as against the bureau’s P1.829 trillion collection goal for 2017.

According to Dulay, the BIR was able to catch up with its collections in the last two months of 2017, thanks to the cooperation of taxpayers.

“We had what I call personally as the ‘last two minutes.’ We sought out the help of taxpayers and we’re very very happy that they responded, that’s why the figures are there. We have a very good tax ratio and we have a good growth rate for 2017,” Dulay said.

For 2018, the BIR is targeting to gather P2.039 trillion in taxes, 14.61 percent higher than the 2017 collection.

Dulay expressed optimism the agency would be able to hit the target with the implementation of the Tax Reform for Acceleration and Inclusion (TRAIN) Act starting this year.

The TRAIN, or Republic Act 10963 aims to lower personal income tax rates, while at the same time hiking the taxes imposed on fuel, automobiles, sugar-sweetened beverages, coal, mining, among others.

According to Department of Finance (DOF) estimates, the law is expected to generate an additional P89.9 billion in revenues for the year.