Business casualty losses from ‘Ondoy,’ ‘Pepeng’ P21 billion to date – BIR

The Bureau of Internal Revenue (BIR) said a preliminary report submitted by corporations on their casualty losses due to the recent massive typhoons showed that they suffered damages to the tune of about P21 billion as of December 10.

“These are casualty losses reported to the BIR that businesses would be claiming as deduction in April next year,” Commissioner Joel Tan-Torres said.

He added the figure could yet go up as it is still preliminary.

If this amount would be converted into tax payment the agency’s income tax collection would be reduced by about P6 billion, Joel Tan-Torres told reporters at the sidelines of the signing of a data sharing agreement between BIR, the Bureau of Local Government Finance and Philippine Association of Local Treasurers and Assessors Inc. (Phaltra).

A post-disaster needs assessment reported that nearly 95 percent of the damage and losses caused by Ondoy and Pepeng was sustained by the country’s productive and social sectors.

The enterprise sector was the hardest hit at $2.34 billion.

The impact was felt mostly by the small and medium enterprise (SME) sector, which normally has limited or no access to credit.

He also admitted that the tax bureau missed its November collection by more than P5 billion, citing the impact of revenue-eroding measures and economic slowdown. The agency was tasked to collect P80 billion last month.

At end-October, the bureau, which contributes more than 75 percent of total government revenues, was already short by about P45 billion after collecting only P612 billion out of its 10-month goal of P657 billion.

In October alone, the bureau collected P54.9 billion, or 3.6 percent lower than last year’s P56.9 billion.

Tan-Torres earlier said the P612-billion collection in the first 10 months meant that the agency was short of P186 billion to meet its full year target of P798 billion.

To boost the agency’s collections next year, the commissioner said they will soon discuss plans for 2010 such as expanding linkages with various agencies to expand its taxpayer database.

In November, the agency partnered with Land Transportation Office to track down the transfer of ownership of used vehicles for tax purposes.

The tax bureau had said it has no tax grip on the sale of second-hand vehicles, which has been a growing industry in the last 10 years.

Tan-Torres declined to provide estimates on how much revenues are lost by the tax bureau because of uncollected tax on the sale or transfer of used vehicles.

And on Wednesday, the Bureau of Internal Revenue, the Bureau of Local Government Finance and Phaltra formalized the agreement for the sharing of taxpayers’ registration data and other necessary documents to check on their tax compliance and to collect the right taxes from them.

Under the agreement, Phaltra should provide the BIR an updated master list of taxpayers and retired business of the preceding year together with the list of existing tax declaration of real properties.

Records on contractors or suppliers engaged in projects, market vendors, cockpit operators, quarry operators or owners—including cost and volume of their production and gross receipts or sales pertaining to any persons subject to tax—should also be submitted to the tax bureau.

The BIR will require the assessor’s office of the local government to provide assessment rolls of taxable real properties for the taxable year together with updates of real property assessments.

For its part, the tax bureau will use the data provided by the two offices in its programs to add to the revenue base and to increase tax collection efficiency.

“This is indeed a welcome development for the bureau to maximize the generation of much needed revenues,” Tan-Torres said. –LAILANY P. GOMEZ REPORTER, Manila Times