TRAIN rev­enues for Jan to Sept 2018 below tar­get

The Philippine Star - - BUSINESS - By MARY GRACE PADIN

The Tax Re­form for Ac­cel­er­a­tion and In­clu­sion (TRAIN) Law gen­er­ated P41.9 bil­lion in rev­enues for the gov­ern­ment in the first nine months of 2018, slightly below the tar­get, the Depart­ment of Fi­nance (DOF) re­ported on Fri­day.

Ac­cord­ing to the lat­est data from the DOF, gov­ern­ment rev­enues un­der TRAIN showed a net gain of P41.9 bil­lion as of end-Septem­ber 2018, cor­re­spond­ing to 94.7 per­cent of the P44.3-bil­lion tar­get for the pe­riod.

The TRAIN col­lec­tion short­fall reached P2.3 bil­lion or 5.3 per­cent as against tar­get.

“In the col­lec­tion, we have suc­ceeded in the first nine months by 94.7 per­cent. In any grad­ing, it’s not so bad,” Fi­nance Sec­re­tary Car­los Dominguez said.

Of the to­tal net gain, P37.5 bil­lion was con­trib­uted by the Bureau of Cus­toms (BOC), 18.48 per­cent short of the P46 bil­lion tar­get. The Bureau of In­ter­nal Rev­enue (BIR) gen­er­ated the re­main­ing P4.5 bil­lion, a pos­i­tive turnout com­pared to the pro­jected net loss of P1.7 bil­lion.

Ac­cord­ing to Dominguez, the na­tional gov­ern­ment had fore­gone rev­enues amount­ing to P102.9 bil­lion in the first nine months of 2018 due to the re­duc­tion in per­sonal in­come taxes (PIT) un­der the TRAIN Law. This is lower than the pro­jected loss of P108.7 bil­lion.

“I want to em­pha­size that the big num­ber there is the re­duc­tion of PIT. The re­duc­tion in PIT in the first nine months of 2018 is P102.9 bil­lion. That is close to P12 bil­lion a month,” Dominguez said.

“That means to say that in­di­vid­u­als had ac­tu­ally an ad­di­tional P12 bil­lion a month spend­ing power. This TRAIN law ben­e­fited di­rectly in­di­vid­u­als who were earn­ing P250,000 and below,” he said.

On the other hand, the DOF said the largest de­fi­cien­cies were seen in the ex­cise tax col­lec­tions of sug­ar­sweet­ened bev­er­ages and val­ueadded tax (VAT).

The gov­ern­ment was able to col­lect P31.2 bil­lion in sug­ary drinks tax as of end-Septem­ber, 28 per­cent below the P43.3 bil­lion tar­get.

“Sweet­ened bev­er­age ex­cise is short by P12.1 bil­lion as the in­dus­try claims that no high fruc­tose corn syrup (HFCS) has been used since Jan. 1, 2018,” the DOF said.

HFCS-sweet­ened bev­er­ages are taxed P12 per liter in­stead of the P6 per liter rate for those with caloric and non-caloric sweet­en­ers.

“The BIR is con­duct­ing an au­dit to as­cer­tain this claim. At the same time, the FDA (Food and Drug Ad­min­is­tra­tion) is ver­i­fy­ing if firms did sub­mit ap­pli­ca­tions to re­for­mu­late from HFCS to reg­u­lar sugar. This is re­quired be­fore firms can legally mar­ket a new for­mu­la­tion,” the DOF said.

More­over, VAT col­lec­tions un­der TRAIN from Jan­uary to Septem­ber last year amounted to P3.6 bil­lion, 85.5 per­cent below the P24.8 bil­lion tar­get.

“The main rea­son cited by the rev­enue agen­cies is that there are only three in­dus­tries (power trans­mis­sion, jew­el­ries and the cen­tral bank) that re­ported im­por­ta­tions, which is now VATable,” the DOF said.

Fi­nance Un­der­sec­re­tary Karl Ken­drick Chua said that there was a surge in the im­por­ta­tion of cap­i­tal equip­ment last year, which in­creased in­put VAT claims in the BIR.

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