Dominguez to pursue expanded RATE, RATS programs started by Henares
The Department of Finance (DOF) on Tuesday bared a commitment to intensify the antismuggling and tax-evasion programs rather than abandon the measures pursued with relative success under then-Internal Revenue chief Kim Jacinto-Henares.
At a business forum convened in Taguig City, Finance Secretary Carlos G. Dominguez III said the intensified approach forms part of the broader goal of pursuing in earnest all 635 pending tax and smuggling complaints filed against particular businesses and individuals, where a potential P103 billion may be collected.
“We will work closely with the Department of Justice [DOJ] to speed up the resolution of 635 pending tax and smuggling cases amounting to P103 billion in collectibles. It will be a sad commentary on our state of affairs if the RATE [Run Against Tax Evaders] and RATS [Run After The Smuggler] programs have resulted in only five convictions for tax evasion and two convictions for smuggling. This is in reference to the Bureau of Internal Revenue’s Run Against Tax Evaders program and the Bureau of Custom’s [BOC] Run After The Smugglers program,” Dominguez said.
He also said the DOF would overhaul the collection systems at the BIR and the BOC to generate enough funds for such priority programs as raising public spending on human capital consistent with President Duterte’s mandate to bring progress to all Filipinos.
Dominguez also bared the intent to review the various tax-incentive programs, since these are costing the government at least P144 billion in tax holidays and other perks: “This administration is committed to rationalizing tax incentives. A truly serious study needs to be done about the relevance of many of those tax perks.” He explained that with the passing of the Tax Incentives Management and Transparency Act (Timta), a further review of the incentives and tax perks process is warranted.
“Fortunately, the previous Congress passed the Timta that seeks precisely to comprehensively review our tax-incentives regime. With the data now being generated, we should be able to have a fuller view of the real costs and benefits of this program. This will enable better review of our options moving ahead,” Dominguez said.
He also said President Duterte’s other goals include revising the procurement law to simplify and streamline its process, simplifying the permit requirements for infrastructure projects; creating a prioritization list and delineating delivery responsibilities between national and local projects; and improving the absorptive capacity of key government agencies through better planning and project execution.
“What we plan to do is to improve the efficiency of delivering basic services and infrastructure to benefit our communities. To accomplish this, we will need to cut redundancy in our procedures,” Dominguez explained.
A review of the existing tax rates will also be undertaken. He noted further tax cuts, both in corporate and personal taxes, should help stimulate businesses and provide citizens with more money to spend on their families and on savings.
At the BIR, Dominguez said they will expand the electronic filing program that has, thus far, allowed the agency to generate 22 million returns in 2015. At the BOC, a rationalization of the import-permit requirements will be implemented. The DOF is also exploring ways to improve the organizational capacities of these two major revenue agencies.
“The decision to trim both income- and corporate-tax rates is consistent with our goal to be a more competitive economy in the region. The country cannot continue to be handicapped by high tax rates, only because we have gotten used to them. There is a norm of efficiency to be observed,
Much more effort will have to be exerted toward making tax payment a truly satisfying and simplified experience,” he said. “We will have to make tax payments more accessible in theory and in practice,” he added.
Source: www.businessmirror.com.ph
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