TRAIN law ex­ceeds rev­enue tar­get

Manila Bulletin - - Front Page - By CHINO S. LEYCO

The government reg­is­tered a net rev­enue gain in the im­ple­men­ta­tion of the Duterte ad­min­is­tra­tion’s first tax re­form law in the first three months of the year ow­ing to higher taxes re­mit­ted by the to­bacco in­dus­try.

In­stead of a net loss of at least R3.2 bil­lion in Jan­u­ary to March, the Bureau of In­ter­nal Rev­enue (BIR) re­ported to the House ways and means com­mit­tee that the government gen­er­ated R12.5 bil­lion in ad­di­tional rev­enues from the tax re­form for ac­cel­er­a­tion and in­clu­sion act (TRAIN).

Based on the BIR data, the main driver of the above pro­gram rev­enue col­lec­tion from TRAIN was the ex­cise tax on cig­a­rette prod­ucts.

The government only pro­grammed R686.1-mil­lion tax rev­enues from cig­a­rettes, but the BIR col­lected R14.97 bil­lion from Jan­u­ary to March this year.

BIR As­sis­tant Com­mis­sioner Al­fredo V. Misajon ex­plained the higher than ex­pected rev­enues from cig­a­rettes is at­trib­ut­able to the sta­ble con­sump­tion of to­bacco prod­ucts de­spite the sev­eral in­creases in ex­cise tax rates.

“We no­ticed that although we in­creased the rates on the ex­cise tax of to­bacco, we’ve seen that the con­sump­tion of to­bacco had not been ta­per­ing off be­cause maybe it’s just the ini­tial months of the im­ple­men­ta­tion,” Misajon said.

The BIR of­fi­cial also said that some cig­a­rette man­u­fac­tur­ers had not raised their re­tail prices de­spite the in­crease in ex­cise levies.

Aside from to­bacco, the BIR also sur­passed its R409.4-mil­lion col­lec­tion tar­get on stocks trans­ac­tion of traded stocks by 175 per­cent to R1.12 bil­lion, while on cap­i­tal gains of non-trade stocks by 29 per­cent to R1 bil­lion against the tar­get of R777 mil­lion.

Rev­enues from documentary stamp tax, like­wise, ex­ceeded the goal of R7.6 bil­lion by 23 per­cent to R8.72 bil­lion, while for­eign cur­rent de­posit unit raised R159.71 mil­lion, sur­pass­ing the R99.72mil­lion goal by 60 per­cent.

Ex­cise tax on coal also breached the tar­get of R166.62 mil­lion, gen­er­at­ing a to­tal of R305.8 mil­lion at end-March, while donors tax amounted to R61.06 mil­lion, a re­ver­sal of the ex­pected R376.19 mil­lion in rev­enue loss.

The government also missed its ex­pected fore­gone rev­enues from the re­duc­tion in personal in­come tax (PIT) rate and es­tate tax.

In the first-quar­ter, the government’s for­gone rev­enues from PIT amounted only to R23.34 bil­lion, be­low the R36.04 bil­lion pro­gram, while es­tate tax losses reached R225.23 mil­lion, lower than the R361.72-bil­lion ceil­ing.

Losses from the ra­tio­nal­iza­tion of value-added tax (VAT) ex­cep­tions were also be­low the R4.2-bil­lion pro­gram at R3 bil­lion.

Mean­while, rev­enues from higher ex­cise on pe­tro­leum were short of the R9.98bil­lion tar­get, gen­er­at­ing only R4.73 bil­lion in the first-quar­ter, while col­lec­tion from au­to­mo­biles was be­low the R673.66-mil­lion tar­get at R363.71 mil­lion.

Rev­enues from sugar sweet­ened bev­er­ages also fell short of the R7.7-bil­lion tar­get in the first-quar­ter at R7.78 bil­lion, tax on coal reached R305,770, well be­low the tar­get of R686.01 mil­lion.

Cos­metic tax also reg­is­tered a hefty be­low tar­get rev­enues at R7,380.

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