Palace aims to sustain long-term progressive revenue generation
MANILA – Malacañang plans raising and sustaining long-term revenue generation nationwide by enhancing government’s tax administration system with increased anti-corruption checks.
“Addressing corruption is an aspect of tax generation,” Presidential Communications Operations Office Secretary Herminio “Sonny” Coloma said.
He noted anti-corruption checks are needed particularly as some taxpayers are creative in defrauding government.
Coloma said government must continuously improve its fiscal state so the country can move forward further and attract more investors.
“We have to look into the strategic concern that our tax collection system must be progressive,” he said.
Malacañang believes enhancing the country’s tax system is due.
Citing latest available data, Coloma reported government’s taxation-to-gross domestic product ratio at present declined to nearly 13 percent only from 17 percent in the 1990s even if the country’s tax base increased already.
“In progressive nations, ratios are higher–that means people there pay taxes as their tax systems are functioning well,” Coloma noted.
The Department of Budget and Management (DBM) earlier raised urgency for increasing government’s revenues, noting overspending during the administration of former President Gloria Macapagal-Arroyo helped bloat the budget deficit.
“There was an over-spending of about P27-billion then while government posted a revenue shortfall of P23 billion,” Undersecretary Mario Relampagos said.
He noted the Arroyo administration should have calibrated public spending against revenue inflows then.
To help increase revenues, government targets improving the tax ratio for Bureau of Internal Revenue and Bureau of Customs combined.
“The target is to increase this ratio to 15 percent next year from the present 12.8 percent,” BIR Commissioner Kim Henares said.
She earlier pointed to the need for improving the tax effort, noting about half of the country’s estimated 90 million-strong population is in the work force but BIR at present is able to collect revenues from some five million fixed-income and other individual taxpayers only.
About 40 percent of those engaged in business and livelihood activities nationwide belong to the underground economy and BIR hasn’t captured this sector yet, she continued.
“It’s an optimistic estimate–the count can be bigger,” she warned.*PNA
