BIR falls short of 2023 target

THE Bureau of Internal Revenue (BIR) fell short of hitting its P2.64 trillion collection target last year, having netted P2.53 trillion.

The amount, however, was still some 7.5 percent higher than the P2.34 trillion it collected in 2022.

“In 2023, we did our best… we are not losing sight [of our targets],” BIR Commissioner Romeo Lumagui Jr. said in a speech on Thursday during the agency's 2024 National Tax Campaign Kickoff.

Lumagui attributed the shortfall to the changes in value-added tax (VAT) payment rules.

“This is significant because previously, the VAT payment… was monthly, but it has now become quarterly. There is one quarter of VAT that did not apply for 2023,” he explained.

Collections would have hit the P2.6 trillion target for the year if the unaccounted VAT was included, Lumagui added.

Finance Secretary Ralph Recto told reporters that the bureau still did a “good job.”

“I think the bigger challenge will be for 2024 because the revenue targets are high as well,” he added.

The BIR needs to collect P3.05 trillion this year, accounting for the biggest share of the government's revenue target of P4.3 trillion.

Lumagui said programs that would help achieve this year's target were being actively implemented.

“We have taken numerous actions, including implementing a new withholding tax on online sellers, digital payments, and transactions. Additionally, we will continue our efforts in pursuing fake transactions and tax evaders,” he said.

“I believe all of these measures will be adequate. With the enhancements in our systems, such as the introduction of digital tax identification numbers and streamlining of processes, we anticipate that the payment of taxes will be more convenient,” Lumagui added.

“We expect people to comply better, leading to increased compliance for this year.”

The BIR was said to have collected P137.18 billion last year from operations against the illicit trade of cigarettes, vape, and other excisable articles.

Moreover, a total of 259 cases were filed through the Run After Tax Evaders (RATE) initiative, with the total tax liabilities involved amounting to P18.3 billion.

Under the Run After Fake Transactions (RAFT) program, meanwhile, 23 cases were filed against ghost corporations, corporate buyers, accounting firms, and buyers and sellers with total tax liabilities of P45.2 billion.

Oplan Kandado also resulted in 179 closures for a total collection of P987.74 billion

As a result of a digitalization push, 2,104,614 e-filers were recorded in 2023, up from 1,995,564 in 2022. The BIR said that 68 percent of filers preferred to do it electronically.