Philippines Misses Tax Targets

May 16, 2012 Taxation in Philippines

Philippines FlagMANILA – Despite the fact that the Philippines has significantly increased the level of taxes collected in the country this year, the tax authorities still have not managed to meet their own revenue goals.

In a statement issued on May 15th the Philippines’ Bureau of Internal Revenue (BIR) confirmed that tax collections in the country only reached PHP 345.4 billion during the first quarter of the current year, with only PHP 116.2 billion collected during April.

Tax collections in the Philippines over April were up by 12.4 percent, compared to the same period in 2011, but were nearly 5 percent lower than the government’s plan of PHP 122.8 billion. Tax experts in the Philippines have already commented on the result, saying that the lower than expected collections were surprising, because April is normally the busiest month for the BIR as it is the deadline for filing of annual income tax returns in the country.

The cumulative tax collections for the first quarter of the year were approximately PHP 10.1 billion below the planned total of PHP 355.5 billion, but exceeded last year’s collection by 13.97 percent.

Commenting on the results, the commissioner of the BIR Kim Henares said, “…we need help in revenue forecasting. The annual target-setting is already imperfect, but breaking it down on a monthly basis is even more imperfect.”

Despite the low collections Kim Henares noted that revenues are growing compared to the same period over the last year, indicating that the government’s efforts to expand the tax base and improve overall tax compliance are working.

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