THE Bureau of Internal Revenue (BIR) is banking on increased consumer spending during the holiday season and higher government spending in the remaining months to meet its P2.6-trillion revenue-collection target this year.
BIR Assistant Commissioner Jethro M. Sabariaga said the bureau remains optimistic that it will hit collection targets this year on the back of better economic activities.
The BIR is trailing behind its revenue collection target in the nine months ending in September, according to latest Bureau of the Treasury (BTr) data.
Treasury data showed that the bureau was only able to collect P1.858 trillion out of its P1.933 trillion programmed target for the January to September period.
This brings the BIR some P742 billion away from its P2.6 trillion full-year target collection.
“First, increased consumption; second will be the government expenditures, which has been identified as one of the reasons why even the projected GDP [gross domestic product] was not met,” Sabariaga told reporters in an interview regarding the factors that would drive the BIR to hit its full-year collection target.
“The government as an agency has a target for expenditure of its budget. We hope that the coming end of the year will push agencies to spend the money more towards its designated purposes. We foresee better performance,” Sabariaga added.
In the fourth quarter of last year, the BIR was able to collect P603.188 billion (net of tax refund).
SABARIAGA pointed that one of the main reasons why the bureau was unable to hit its 9-month target.
He explained that the BIR has been aggressive and efficient in its tax collections, hitting a tax effort ratio of 14.5 percent, above its mandated performance of 10.6 percent. However, a sluggish economic growth crimps their efforts, Sabariaga said.
“The economy has been projected to grow at 6 percent to 7 percent this year; but for the first half of the year the growth rate has only been 5.3 percent. The people of the revenue services are not magicians—efficiency can only take you so much,” he said.
“If it is analyzed, the collection performance and the tax effort ratio assigned to the BIR is about 10.6 percent. The bureau is performing at 14.5 percent. I think that just goes to highlight the correlation of the economy to the collection performance of the bureau,” Sabariaga added.
Despite not being able to meet its 9-month collection target, the BIR’s total tax revenues rose by 7.25 percent year-on-year to P1.858 trillion from P1.732 trillion in the same period of last year.
However, the BIR’s revenue collection in September alone fell by 12.36 percent on an annual basis to P152.2 billion from P173.6 billion, Treasury data showed.