TAXES collected by the country’s two biggest revenue-generating agencies started to pick up in June, but this was not enough to help them meet collection targets for the first six months of 2020.
Citing preliminary data, the Department of Finance (DoF) said the Bureau of Internal Revenue (BIR) and Bureau of Customs (BoC) collected a total of P270.77 billion last month, 28% higher than the P211.5 billion logged in June 2019.
This is a reversal from the 52% and the 39% contraction reported in May and April, respectively.
The BIR collected P228.23 billion in June, a 42.47% surge from the P160.2 billion a year ago, but fell 19.86% short of the P284.8-billion target. The higher collection was attributed to the fact that the deadline for filing and payment of annual income taxes and other returns fell on June 15. The original April 15 deadline was pushed back several times to give relief to taxpayers during the lockdown.
The BIR’s Large Taxpayer’s Service (LTS) unit generated P145.81 billion in June, up 35.05% from P107.97 billion a year ago. Of the total, income taxes soared 82.5% to P83.7 billion from the P45.86 billion reported a year ago.
LTS collections from value-added tax (VAT) also rose 7% year on year to P24.25 billion from P22.68 billion and 11.7% above the target of P21.71 billion.
Meanwhile, BoC generated P42.54 billion in revenues in June, exceeding its collection target of P40.74 billion by 4.4%. No comparative data was provided.
The Customs bureau said in a statement the improvement was largely due to “intensified collective effort of all ports and the gradually improving volume of importation.”
Separate BoC data obtained by BusinessWorld showed volume of imports jumped 30% in June to 8.06 billion kilograms (kg) from the 6.2 billion kg of imports seen in May and also 7% higher than the 7.13 billion kg in April.
Imports last month, however, were still lower by 22% from the 10.38 billion kg logged in June 2019, but the contraction was smaller than the 41.22% year-on-year slump recorded in May.
“It can also be attributed to the government’s effort in ensuring unhampered movement of goods domestically and internationally considering the pandemic situation,” the statement read.
Despite the improved figures in June, the first-half collections of the BIR and BoC dropped by 16% to P1.15 trillion compared to the P1.375 trillion a year ago.
BIR’s collections declined 15.9% from a year ago to P901.96 billion in the six-month period, and fell 3.4% below target.
“This collection period includes the months when strict quarantine measures were imposed to contain the spread of the coronavirus disease 2019 (COVID-19) that led to a virtual economic standstill in Metro Manila and the rest of Luzon,” DoF said in the statement.
Of which, BIR collected P273 billion in income taxes of large taxpayers, 15.47% down from P323 billion a year ago and 7.61% short of its target for the period.
VAT collections from large taxpayers hit P112.35 billion, down 11% from a year ago but higher by around six percent of its P106.09-billion goal.
On the other hand, BoC revenues during the period slipped by 16.5% year on year to P253.04 billion and 0.47% lower than its reduced P254.25-billion goal.
DoF attributed the decline to lower import volumes as a result of the global economic slowdown.
Customs data showed import volume has been on a steady decline since January, bringing the total import volume to 48.13 billion kg in the first semester, down 17.74% from the 58.51 billion kg recorded in the same period last year.
BIR’s revenue target for 2020 was slashed to P1.744 trillion, 23% lower than its P2.205-trillion goal set in March.
BoC has a collection target of P542 billion this year, which has been reduced from the initial P730-billion goal set earlier this year.
Government’s overall revenues are projected to fall sharply to P2.612 trillion this year as tax collections weaken amid the economic downturn.
The economy is expected to contract by 2-3.4% this year. — Beatrice M. Laforga