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Philippines: TRAIN to push 2018 revenues to P2.806 trillion
MANILA, Philippines — The national government’s revenue is projected to reach P2.806 trillion this year due to additional collections to be generated from the final tax reform law, data from the Department of Finance (DOF) showed.
According to DOF estimates, the government’s revenue program for this year may be slightly adjusted upward to P2.806 trillion from the previous forecast of P2.789 trillion during the Development Budget Coordination Committee’ (DBCC) meeting last Dec. 22, 2017.
The slight increase was brought about by President Duterte’s line veto on five provisions of the Tax Reform for Acceleration and Inclusion Act (TRAIN).
This is also higher by 17.55 percent than the projected 2017 revenue of the government, which is anticipated to reach P2.387 trillion.
According to the DOF, the P2.806 trillion revenue program for the year corresponds to 16 percent of the country’s gross domestic product, higher than the 15 percent projected for 2017..
Of the total amount, P2.637 trillion is expected to come in the form of tax revenues.
About 77 percent of the amount will be accounted for by the Bureau of Internal Revenue (BIR), with a total collection goal of P2.039 trillion this year. This is 16 percent higher than the estimated P1.758 trillion collection of the bureau in 2017.
The Bureau of Customs (BOC), meanwhile, is expected to collect P581.3 billion, 29 percent up from P450.3 billion last year. Other officies are seen to contribute P15.9 billion.
Meanwhile, non-tax revenues this year are seen to reach P166.8 billion, while income from the disposition and privatization of assets is estimated at P2 billion.
By 2022, the national government’s revenue is forecast to jump to P4.414 trillion, equivalent to 17.1 percent of the GDP.
A total of P4.247 trillion of this amount will come in the form of tax revenues, with P3.312 trillion coming from the BIR and P914.8 billion from the BOC.
Republic Act 10963 or the TRAIN Act, which contains Package 1A of the DOF’s Comprehensive Tax Reform Program (CTRP), aims to simplify the country’s tax system by by lowering personal income tax rates.
It also seeks to adjust excise taxes of fuel, automobile, coal and sugar-sweetened beverages, and expand the tax base by removing value-added tax exemptions.
Earlier, Duterte vetoed five items of the law, including the provisions (1) granting a special tax rate of 15 percent on the gross income of employees of regional headquarters, regional operating headquarters, offshore banking units, and petroleum service contractors and subcontractors; (2) providing zero-rating on the sales of goods and services of separate customs territories and tourism enterprise zones; and (3) exempting self-employed and professionals with total annual gross sales and/or gross receipts not exceeding P500,000 from the percentage tax.
He also vetoed the provisions (4) exempting various petroleum products from the excise tax when used as input, feedstock, or as raw material in the manufacture of petrochemical products; or in the refining of petroleum products; or as replacement fuel for natural gas fired combined cycle power plants; and (5) earmaking the incremental revenues from tobacco taxes for tobacco productivity programs, and as share in the income of tobacco-producing provinces.
The DOF earlier said it expects Congress to approve in the first quarter of this year additional provisions under “Package 1-B” of the CTRP. The agency is also preparing to submit the second package of the tax reform program this month.
Source: http://beta.philstar.com/business/2018/01/10/1776204/train-push-2018-revenues-p2806-trillion#zfDilDqpIs7lhbbs.99