MANILA, Philippines - Finance Secretary Cesar Purisima has ordered the Bureau of Internal Revenue (BIR) to increase the yearly tax collection from self-employed people before the end of the term of President Aquino.
Purisima said the annual tax payments of professionals "remain unrealistically low" at around P5,500 per person to about P200,000 each during the next two years. "This will be made possible by closely monitoring the income-tax payments of professionals at each RDO [Revenue District Office]," Purisima said.
Income taxes from individuals account for more than 20 percent of the BIR's tax collection each year. But the bulk of such collection comes from salaried people whose income taxes are automatically withheld by their employers.
For the year, the BIR is eyeing to raise P222.28 billion from professionals, some 15 percent higher than the previous year's actual collection of P192.72 billion. "We would like to see the income-tax collection for individuals to reach P320 billion, more than enough to cover the budget deficit," Purisima said.
For the year, the government's deficit cap is set at P279 billion. The BIR is tasked to collect P1.066 trillion for 2012.
The Professional Regulation Commission (PRC) lists some 3 million registered professionals in the country; around 190,000 of them are doctors and lawyers—the two top earners among the other professions. The rest are accountants, engineers, nurses and seafarers who are either self-employed or employed formally. The average annual income-tax payments of professionals is less than the monthly minimum wage of P8,500, according to the BIR.
Purisima said he wants to see the current average income-tax payment of the professionals to increase to an average of P100,000 by year-end and another P100,000 by the following year. "We will continue to set ambitious goals in order for the BIR to reach its [revenue] goal," he said. As of June, the BIR already collected P521.15 billion, or half of its goal for the year.
Source: Business Mirror
