BIR appeals for voluntary payment of taxes

April 24, 2009 11:58 pm 

MANILA, April 23 – The Bureau of Internal Revenues (BIR) chief Sixto Esquivias IV expressed fears of a significant reduction in voluntary tax payments this year due to global economic slowdown.

But Esquivias urged BIR collecting agents to redouble efforts in containing the budget deficit to P199.2 billion from P177.2 billion originally.

He said that enforcing tax laws did not translate to significant increase in collections.

"Throwing the book at millions of Filipino taxpayers is like squeezing blood out of stone as the exercise adds to the collection kitty no more than 0.6 percent of total," he said.

Instead, he said he encouraged taxpayers to come upfront and volunteer the money since this approach accounted for 99.4 percent of total collection.

“I made a study and found that voluntary compliance account for 99.4 percent of collections while enforcement contributes only 0.4 percent,” Esquivias said.

Esquivias started as a bean counter in the BIR but later spent long years as tax lawyer in the private sector before assuming the top post at the agency last November.

The BIR is already P10.5 billion short of its collection commitments in the first three months.

He plans to impose stiffer penalties on businesses that fail to submit a list on their sales and purchases as required by law.

Compliance to this stricture comprised about 30 percent, which was very low indeed, Esquivias said.

Peer agencies in Asia had significantly higher compliance rates, he added.

He warned to treat failure to submit such a list as failure to submit one’s tax return, replacing the existing P1,000 fine as a strong deterrent.

One could be summoned by subpoena for such a failure and one could go to jail for it as well, Esquivias said.(PNA) RMA/Jun Vallecera/utb


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