The Bureau of Internal Revenue (BIR) has intensified its drive against tax evasion and efforts to strengthen tax compliance under Finance Secretary Benjamin E. Diokno’s watch, which has led to the achievement of a historic level of tax collections in recent years.
“The BIR has done extremely well in strengthening our country’s coffers by simplifying tax compliance through digitalization as well as combating tax evasion. I am confident that we will be able to reach or even exceed the collection targets set in the Medium-Term Fiscal Framework (MTFF) for this year and until 2028 through the Bureau’s initiatives,” said Secretary Diokno.
Through its Run After Fake Transactions (RAFT) program, the BIR has identified and filed criminal cases against sellers and users of commercial invoices/receipts used to support fake transactions.
From January to September 2023, the BIR has filed cases on four ghost corporations with estimated tax liabilities of PHP 25.5 billion and three Corporate Buyers and their Officers, Accounting Firms, and Certified Public Accountants (CPAs) with total estimated tax liabilities of PHP 17.9 billion.
The BIR was able to achieve a historic level of tax collection in recent years due to its strict nationwide enforcement operations on the illicit trade of cigarettes, vape, and other excisable articles through national raids and the filing of criminal cases against offenders.
Last January 2023, the BIR had its first nationwide raid of illicit cigarette traders, where revenue officers from all over the country participated in the simultaneous raid of establishments.
It had a follow-up operation in July 2023, this time targeting illicit cigarettes, as well as illegal activities related to vape and alcohol products.
To effectively combat tax evasion, the BIR’s Run After Tax Evaders (RATE) Program acts as a deterrent by penalizing tax evaders and generating public awareness in the filing of criminal tax cases.
The RATE program enhances voluntary compliance among taxpayers; promotes public confidence; and helps increase revenue collection.
A total of 246 RATE cases were filed by the BIR with the Department of Justice (DOJ) with estimated tax liabilities of PHP 14.73 billion for the period July 2022 to October 2023.
Meanwhile, Oplan Kandado strengthens the BIR’s imposition of prescribed administrative sanctions through enforcement of at least one closure order issued or one taxpayer’s compliance and payment for every semester, according to the Revenue District Office (RDO).
For the period July 1, 2022 to October 13, 2023, the Bureau collected PHP 496.57 million and issued closure orders to 272 business establishments nationwide under Oplan Kandado.
The Tax Compliance Verification Drive (TCVD) is among the measures that help the BIR increase the number of active registered business taxpayers.
As a result of TCVD, the BIR was able to visit a total of 89,139 establishments nationwide and collect PHP 157.39 million from July 2022 to December 2022. From January to August 2023, the BIR visited 128,562 establishments and collected PHP 180.01 million.
To further increase tax compliance, the BIR’s Estate Tax Amnesty Program allows taxpayers to avail of Estate Tax Amnesty to maximize the collection of tax arrears and unfiled/unpaid estate tax.
From July 2022 to September 2023, the Bureau collected a total of PHP 2.06 billion from 60,416 availers of the Estate Tax Amnesty Program.
Another important tool for improving tax compliance is digitalization. The BIR has launched the Digital Transformation (DX) Program to make its services more modern, convenient, and accessible by turning the agency into a data-driven organization with a digitally empowered workforce using technology to enhance the taxpayer experience.
As a frontline agency, the BIR has also upgraded the quality of its services by increasing the number of International Organization for Standardization (ISO)-certified offices.
To date, there are 18 Revenue Regions (RRs) that have earned certification under the ISO 9001:2015 Quality Management System (QMS).
In addition to intensifying tax compliance and combating tax evasion, the BIR has been working to broaden the tax base by increasing its registered business taxpayers by 3 percent.
For the period July to December 2022, the Bureau recorded a 2.9 percent increase in registered business taxpayers while a growth of 3.7 percent was posted from January to September 2023.