(Source: senate.gov.ph | November 19, 2018)
A one-time opportunity to settle tax obligations that would include estate taxes, general taxes and delinquent accounts will soon be granted to those who have failed to pay for taxable year 2017 and prior years.
Senate Bill No. 2059, otherwise known as “An act enhancing revenue administration and collection, and broadening the tax base by granting an amnesty on all unpaid internal revenue taxes imposed by the national government for taxable year 2017 and prior years with respect to estate tax, other internal revenue taxes and tax delinquencies add cross-border tax evasion and for other purposes,” has been approved on third and final reading.
“We hope that this measure will encourage those in the formal and non-formal sector to legitimize, properly declare and pay the correct taxes without fear of civil, criminal or administrative penalties,” Sen. Sonny Angara, chair of the Senate Ways and Means Committee, said.
“This is our chance to have a fresh start especially in something as important as taxes. As Filipinos seek a government they can trust, let this amnesty serve as another step closer to that end,” Angara added.
Once the bill is enacted into law, taxpayers can avail of a reprieve from all estate taxes on covered taxable years and pay a rate of 6% based on the total net estate.
“The difficulties and the apparent heartlessness of the process partially explain why estate taxes account for so little of our total collections,” Angara said.
The Bureau of Internal Revenue (BIR), the senator said, collected a little more than P4 billion in estate taxes in 2016 or only 0.28% of the agency’s total collections worth P1.57 trillion.
The ratio between the number of estate tax returns filed and number of registered has remained at a low average of 7.16%, Angara added.
The grant of general amnesty which shall cover all national internal revenue taxes, including value-added tax (VAT) and excise taxes collected by the Bureau of Customs (BOC) is also included in the bill.
In lieu of the taxes supposed to be paid, only 5% of the total net worth or a minimum of tax depending on the subscribed capital for corporations will be collected.
Those who will avail will need to accompany their General Amnesty Tax Return with a notarized Statement of Assets, Liabilities and Net Worth (SALN). Discounts will also be granted for early availers.
To enhance revenue collection, minimize administrative cost in pursuing tax cases and de-clog the tax case dockets pending in various courts, the bill included a provision for tax amnesty on delinquencies (TAD).
Under this provision on TAD, taxpayers can avail of 40% of the basic tax for delinquencies and assessments which have become final and executory, 50% for those subjects of pending criminal cases and 60% for cases subject of final and executor judgment by the courts.
The BIR, Angara said, has more than P197.57 billion as delinquent accounts covering 2015 and prior years sitting idly in more than 58,600 cases.
Those who will avail of the amnesty program will be immune from payment of all taxes and the filing of civil, criminal and administrative cases and other penalties.
“Layunin ng tax amnesty na isaayos ang sistema ng pagbubuwis na magdadala nang higit pang kita para sa gobyerno upang mapondohan ang mga proyekto na makatutulong sa bawat pamilyang Pilipino,” Angara said.
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