Tax Reforms Yield P576 B in New Revenue—DOF – Manila Bulletin
The Department of Finance (DOF) reported that the Comprehensive Tax Reform Program (CTRP) launched by President Duterte since taking office has generated more than half a trillion pesos in new government revenue.
In a report to Secretary of Finance Carlos G. Dominguez III, the DOF’s Domestic Finance Group (DFG) said personal income tax (PIT) reforms, amnesty for delinquent taxpayers, and l he increase in sin taxes brought in 575.8 billion pesos to the state coffers. from 2018 to 2021.
In the past year alone, tax revenue from the Tax Reform Acceleration and Inclusion (TRAIN) Act, the Tax Amnesty Act and the Sin Tax Reform Acts reached 228.6 billion pesos, or 13 .7% more than the objective for the year.
TRAIN or Republic Act or RA 10963 provided 99% of taxpayers with significant tax savings resulting from lower IRP rates, while the Tax Amnesty Act (RA 11213) allowed errant taxpayers to settle their unpaid tax debts.
Meanwhile, the Sin Tax Reform Acts (RAs 11346 and 11467 as well as certain TRAIN provisions) imposed higher excise duties on cigarettes, heated tobacco products, vaping products and beverages. alcoholic.
Dominguez said the passage and implementation of these tax reform laws, along with the subsequent CREATE (Corporate Recovery and Tax Incentives for Enterprises) Act, makes President Duterte’s CTRP nearly 90 percent complete.
Finance Undersecretary Valery Brion said that in 2021, TRAIN contributed 171.1 billion pesos in additional revenue, 8.3% above the target of 157.9 billion pesos .
On the other hand, sin tax laws yielded 52.9 billion pesos, 22.7% more than the target of 43.1 billion pesos; and the tax amnesty provided an additional 4.6 billion pesos, Brion said.
Over a four-year period from 2018 to 2021, TRAIN added 476.1 billion pula; the tax amnesty law, 14.6 billion pesos; and the sin tax laws, P85.billion into the State coffers.
Brion said the additional revenue from these tax reform laws was intended to fund President Duterte’s “Build, Build, Build” program and the Universal Health Care (UHC) program.
Previously, the DFG reported that despite the implementation of the CREATE Act, corporate tax collection remained the largest source for the Office of Internal Collections, accounting for around 22% on average of total tax revenue.
CREATE reduced the corporate tax rate from 30% to 20% for micro, small and medium-sized enterprises (MSMEs) and to 25% for all other companies.
CIT’s revenue share of gross domestic product (GDP) could have reached 3.2% without the pandemic, Brion said.
Dominguez said TRAIN and the CTRP’s other tax reform programs enabled President Duterte to raise infrastructure spending to more than 5% of GDP, double the level recorded by the four previous administrations.
It has also increased spending on social services for human capital development and given the Philippines the fiscal strength to weather the worst of the global COVID-19 crisis in light of the huge financial need for the response to the pandemic, he said.
SUBSCRIBE TO THE DAILY NEWSLETTER
CLICK HERE TO JOIN