The Tax Management Association of the Philippines Inc. (TMAP) is calling on the 18th Congress to repeal the bank secrecy law so the government could put in place a more effective general tax amnesty system.
TMAP President Eleanor L. Roque told reporters that taxpayers are still keen on general tax amnesty, the repeal of the bank secrecy law to allow the scrutiny of “suspicious” bank accounts and the automatic exchange of information (AEOI).
“Well, the taxpayers are still hoping because it’s really a good component, it’s still part of the TRAIN [Tax Reform for Acceleration and Inclusion law]. Taxpayers are still hoping that the 18th Congress will still pass that general tax amnesty,” Roque said.
Apart from enabling a more efficient implementation of tax amnesty, she said the lifting of bank secrecy and the AEOI, are also international commitments of the Philippines.
“We are supportive of the DOF [Department of Finance] requirements, the lifting of the bank secrecy and AEOI. We do know that those are crucial [pieces of] legislation and that’s our international commitments, so the AEOI and lifting of the bank secrecy really needs to be passed,” Roque said.
“You can’t have an effective general tax amnesty without those rules. Who will avail if they feel that they can be caught?” she added.
Last March, the DOF said potential revenues from the implementation of the Tax Amnesty Act of 2019 or Republic Act (RA) 11213 is estimated at P27.54 billion, lower than the estimated potential revenues of P63.5 billion under its original amnesty proposal.
The DOF added that the projected revenue from implementing RA 11213 is lower due to the exclusion of the general tax amnesty and the AEOI provisions. Also, Congress has yet to pass a measure that would ease the restrictions in the bank secrecy law.
Under the original tax amnesty proposal of the DOF, which includes the said provisions, estimated revenue collections was seen to reach as high as P63.5 billion.
The DOF proposed tax amnesty measure, which is under its Package 1B of the Comprehensive Tax Reform Program, includes measures of an estate tax amnesty which is estimated to generate P6.28 billion; general tax amnesty, P13.63 billion; tax amnesty on delinquencies, P27.16 billion; and lifting of the bank secrecy law for criminal cases, as well as the AEOI, P16.6 billion.
President Duterte signed but partially vetoed RA 11213 in February because it did not contain a provision that lifted bank secrecy for fraud cases.
RA 11213 seeks to enhance revenue administration and collection by granting an amnesty on all unpaid internal revenue taxes imposed by the national government for taxable year 2017 and prior years. This is with respect to estate tax and other internal revenue taxes and tax on delinquencies.