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Transforming the country’s mental healthcare system

FERNANDO CFERDOPHOTOGRAPHY-UNSPLASH

The second week of October every year is National Mental Health Week. The World Health Organization (WHO) describes mental health as a state of mental wellbeing that enables people to cope with the stresses of life, realize their abilities, learn well and work well, and contribute to their community.

Mental health conditions can cause difficulties in all aspects of life, including relationships with family, friends, and community. They can result from or lead to problems at school and at work. People with severe mental health conditions die 10 to 20 years earlier than the general population, explains the WHO.

The economic consequences of mental health conditions are also enormous, with productivity losses significantly outstripping the direct costs of care, the WHO added.

At least 3.6 million Filipinos suffer from mental, neurological, and substance use disorders, according to the Department of Health (DoH). The 2021 Young Adult Fertility and Sexuality Study (YAFS5), which was conducted at the height of the COVID-19 pandemic, found that the percentage of Filipinos aged 15 to 24 who ever considered ending their life or attempted suicide more than doubled between 2013 and 2021. Likewise, the percentage of Filipino youth who often felt depressive symptoms almost doubled from 2013 to 2021. Depressive symptoms include feeling lonely, sad, or depressed, and feeling disliked by other people.

Almost nine out of 10 employees in the Philippines (87%) experience work-related mental health issues, a recent study by an insurance company showed. The mental health issues reported by the respondents included fatigue, trouble sleeping, stress and anxiety, loss of interest, difficulty concentrating, loss of self-confidence, a feeling of worthlessness, and appetite or eating disorders.

Access to mental health services in the country can still be improved, with less than one mental health worker for every 100,000 Filipinos according to the Philippine Mental Health Association, an NGO composed of mental health professionals and advocates.

A 2023 study showed that 40% of local mental health professionals consider high financial cost as the top barrier for patients seeking access to mental healthcare in the country. Cost was followed closely by stigma-related barriers, namely embarrassment or shame (35.9%), concern about being perceived as “crazy” (31.0%) or weak (30.3%), and concern about the reaction of family (23.4%) and other people (22.1%).

The study was conducted by the Harvard Humanitarian Initiative as part of its HHI Resilient Communities program in cooperation with the Philippine Psychiatric Association and Psychological Association of the Philippines.

Recognizing the urgency of addressing this problem, the DoH in collaboration with the WHO launched the 2024-2028 Philippine Council for Mental Health (PCMH) Strategic Framework. The framework will guide the development and implementation of mental health policies, programs, and services to address the significant burden of mental illness and improve mental health and wellbeing in the country.

Aligned with the DoH 8-Point Action Agenda and formulated through the inputs of various government agencies and key stakeholders, the five-year strategic plan aims to reduce premature mortality, prevent and treat substance abuse effectively, and reduce the vulnerability of individuals and communities to mental, neurological, and substance use disorders.

Since the enactment of the Mental Health Act in 2018, the DoH has scaled up mental health services and the provision of quality essential medicines, including mental health medicines. The Health department has also capacitated health and non-health personnel at the primary care level through the continuous implementation of the Mental Health Gap Action Program (mhGAP) in local government units. The National Center for Mental Health’s 24/7 crisis hotlines were also established.

Areas for improvement remain, according to Filipino psychiatrist Dr. Rowalt Alibudbud in his paper “Towards transforming the mental health services of the Philippines,” published in the peer-reviewed journal The Lancet Regional Health — Western Pacific in October 2023.

The paper pointed out that mental health services in the country are concentrated in psychiatric hospitals and outpatient care services in general hospitals, with limited integration into primary healthcare and informal community support. As such, it recommended the establishment of community-based mental health services and implementation of processes to improve mental healthcare accessibility and affordability.

The paper also underscored the importance of integrating different levels of care to ensure an efficient and responsive mental healthcare system. Resources in tertiary-level services, including psychiatrists and emergent services, can be harnessed to facilitate the training of primary care workers and establish referral centers within communities.

The research-based pharmaceutical industry is actively engaged in the global fight against mental and neurological disorders. We have more than 200 compounds in research and development, and several on-the-ground partnerships to help patients.

Our industry believes that multistakeholder participation and a whole-of-society approach are crucial in transforming the country’s mental healthcare system to reduce the burden of mental and neurological disorders and improve mental health among Filipinos. Overcoming stigma; strengthening primary care services; and engaging the social, economic, and education branches of government and across sectors are pivotal tasks for the country’s health community.

 

Teodoro B. Padilla is the executive director of Pharmaceutical and Healthcare Association of the Philippines which represents the biopharmaceutical medicines and vaccines industry in the country. Its members are in the forefront of research and development efforts for COVID-19 and other diseases that affect Filipinos.

Style (10/07/24)

barenbliss has new pouch

THE Korean make-up brand barenbliss has partnered with Good Juju, a local utility tote bag brand for an exclusive collaboration, launching the limited edition barenbliss x Good Juju Bliss Jelly pouch. The pouch gets a barenbliss makeover as part of the makeup brand’s campaign for its Plum Makes Plumping Lip Gloss. The Bliss Jelly pouch includes barenbliss makeup essentials, and one can customize their pouch’s contents by choosing from different shades of Plum Makes Plumping Lip Gloss, Apple Makes Adorable Mousse Tint, and Dream Chaser Quad Eyeshadows. This limited-edition kit is now available at barenbliss’ official stores on Shopee Mall and TikTok Shop for P999.

Dermorepubliq releases travel sizes

Dermorepubliq has launched Dermo Cuties, a travel-sized collection of its serums and toners. The Dermo Cuties collection includes travel-sized versions of the 5% Niacinamide + Hyaluronic Acid Serum and the 2% Salicylic Acid (BHA) Deep Pore Care Toner, priced at P149. Founder Keith Sta. Barbara said, “These trial-sized ‘cuties’ makes it easy for skincare beginners and loyal users alike to explore our range without the expense of full-sized essentials. Their affordability makes them easy to add to shopping carts alongside our best-sellers.” The collection was made available for purchase exclusively on TikTok starting Sept. 29, followed by an extended release across other online platforms on Sept. 30. A wider market restock is scheduled for Oct. 10, coinciding with the 10.10 double-digit sale, after which the products will be permanently available.

New Balance WRPD Runner colorway launched

New Balance is launching the latest WRPD Runner colorway launching exclusively at Foot Locker with a global campaign featuring brand ambassador and 2023 NBA World Champion Jamal Murray. The WRPD Runner’s recognizable foundations provide a stable launching pad for innovative new designs and features. Rooted in FuelCell performance and design, the WRPD runner is a futuristic take on the classic running-inspired design. The new WRPD Runner colorway in Linen/Sea Salt/Dolce is now available at select Foot Locker branches.

Brand reignition

The Volvo XC40 Recharge is the BEV version of the most compact and affordable Volvo in the local market. Available locally in a sole P8 Recharge Twin Motor variant, it is priced at P3.99 million. — PHOTO BY DYLAN AFUANG

Recharge models are at the forefront of Volvo PHL’s presence boost

By Dylan Afuang

WHILE VOLVO revised its plans to offer only battery electric vehicles (BEVs) by 2030, the XC40 and C40 Recharge — the Swedish auto marque’s BEVs and its latest models to arrive here — appear to lead the brand’s presence boost in the Philippine market.

By 2030, Volvo aims that 90% of its sales will comprise plug-in hybrid (PHEVs) or BEVs, with 10% to be accounted for by mild hybrids (MHEVs) that merely use electricity to supplement a combustion engine. Citing sliding demand for BEVs, many European car makers have also expressed a similar shift in their electrification targets.

Upcoming models from Volvo Philippines would potentially follow this new goal, company Sales and Marketing Director Cyrus Dan Catapang told “Velocity” during the brand’s “Recharge the Drive” event held at its showroom along Pasong Tamo in Makati City recently. The affair showcased to potential customers the XC40 and C40 Recharge BEVs.

The XC40 Recharge is the BEV version of the most compact and affordable Volvo in the local market, which is also available here in gasoline-hybrid form. The C40 Recharge is virtually the same vehicle, but sports a sleek, sloping roofline. These crossovers are available here in P8 Recharge Twin Motor guises (P3.99 million for the XC40, and P4.190 million for the C40).

Both Volvo crossovers are equipped with brand hallmarks, such as advanced safety engineering and gadgets, and sustainable interior materials, and what their model designations suggest, powered by electric motors mounted on their front and rear axles that spin the XC and C40 Recharge’s four wheels. The cars boast a range north of 500km.

The Volvo Philippines official shared that the company’s traditional customers are warmly considering the latest Volvo cars and their new means of propulsion. The distributor also aims for its customers retain their loyalty to the brand, establish a better presence in the local premium vehicle market, and improve its after-sales services.

“Our marketing strategy for this year and for the coming years is to rebrand Volvo,” Mr. Catapang responded to a question from “Velocity.” “We promise to be more visible, (for example) through ads and social media.”

He added, “We will also renew our relationships (with established Volvo customers and have them) renew confidence in us.” The company plans to add more retail and servicing sites soon. Currently, Volvo Makati is the brand’s sole dealership and service center in the country.

During a brief test drive of the C40, we saw that Volvo still makes comfortable seats, and that the brand still prioritizes users’ ease of operation, owing to the car’s intuitive infotainment screen that enables access to the majority of the vehicle’s features. All drivers and passengers, meanwhile, will appreciate the C40’s seamless power delivery, serene ride, and refined cabin.

For safety, the Recharge cars come with adaptive cruise control with Pilot Assist, Blind Spot Information System, 360-degree camera, traffic sign recognition, rear collision warning, run-off mitigation system, and slippery road alert system. Volvo boasted that the cars’ cabins and batteries are protected by an “advanced structure and safety cage.”

Other models in the Volvo Philippines’ lineup are MHEV versions of the compact XC40 and XC60 crossovers, and full-size XC90 SUV and S90 sedan. Interested customers are invited to contact Volvo Sales at 0967-172-9366 for more information.

Macasaet steps down as SSS chief

SOCIAL SECURITY SYSTEM (SSS) President and Chief Executive Officer Rolando L. Macasaet has stepped down from his position effective Oct. 6 (Sunday).

This marks the end of his near two-year stint at the helm of the state pension fund, which began on Jan. 5, 2023, SSS said in a statement on Sunday.

Malacañang has yet to announce the next SSS head.

Media reports over the weekend said Mr. Macasaet resigned to run for a party-list post.

Under Mr. Macasaet’s term, SSS reached a record-high three million new members in the first nine months of 2024. This was more than double the number of new members recorded in the same period last year.

This puts the pension fund on track to have four million to five million new members for this year.

SSS’ net income rose by 58% to a record P83.13 billion in 2023. — AMCS

France offers 75 million euros for disease-hit sheep farms

REUTERS

PARIS — France will provide 75 million euros in aid for sheep farms hit by a fast-spreading virus, Prime Minister Michel Barnier said Friday in a show of support for struggling farmers despite a budget crisis facing the new government.

Livestock disease outbreaks as well poor harvests and plans by dairy giant Lactalis to cut milk purchases have rekindled discontent among French farmers who staged large-scale protests earlier this year.

The funds for sheep farms affected by a new variant of the bluetongue virus, which is spread by insects and can be deadly for sheep, cattle, and goats, are in addition to a free vaccination program that the government has extended to the whole of the country for sheep flocks.

Speaking at a livestock fair in central France, Mr. Barnier also said the government would put in place state-guaranteed loans to provide short-term relief for worst-off farms.

Mr. Barnier nonetheless reiterated that his administration was bound by a budget squeeze as it aims to find 40 billion euros in savings. In a nod to recent heavy rain and farmer resentment at environmental regulation, he announced a seasonal cut-off date for spreading livestock manure on farmland would be extended from Oct. 1 to Nov. 15.

The government will relaunch in January parliamentary debate on a farming bill, Mr. Barnier added, after the legislation drafted in response to this year’s protests was delayed by the snap election that led to the formation of Mr. Barnier’s minority government. — Reuters

How PSEi member stocks performed — October 4, 2024

Here’s a quick glance at how PSEi stocks fared on Friday, October 4, 2024.

Stocks may extend climb on slower Sept. inflation

BW FILE PHOTO

PHILIPPINE SHARES may climb further this week after September headline inflation settled below 2% for the first time in over four years, bolstering bets of further interest rate cuts by the Bangko Sentral ng Pilipinas (BSP).

On Friday, the benchmark Philippine Stock Exchange index (PSEi) rose by 1.06% or 79 points to close at 7,467.92, while the broader all shares index went up by 1.48% or 58.99 points to end at 4,041.65.

This was the PSEi’s best finish in more than two-and-a-half years or since it closed at 7,502.48 on Feb. 9, 2022.

Week on week, the PSEi climbed by 0.53% or 39.62 points from its 7,428.30 finish on Sept. 27, logging its fifth consecutive week of gains.

“The bellwether index mostly held steady but gained momentum towards the end of the week after local inflation hit a four-year low. After a weak start, the PSEi managed to eke out gains,” 2TradeAsia.com said in a market note.

“Despite the episodes of profit taking, the local market still managed to close the week with gains and in the process closed above 7,400,” Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco said in a Viber message.

For this week, inflation data released on Friday could prop up Philippine stocks, he said.

“The below-expected inflation print of the Philippines for September is seen to boost market sentiment due to its positive implications on the local economy. The low inflation figure could mean stronger household consumption, which would benefit our overall economic growth given its significant contribution. The low inflation also strengthens the case for the continuation of the BSP’s monetary policy easing,” Mr. Tantiangco said.

Headline inflation slowed to 1.9% in September from 3.3% in August and 6.1% a year ago, the Philippine Statistics Authority reported on Friday.

This was below the BSP’s 2%-2.8% forecast for the month and the 2.5% median estimate yielded in a BusinessWorld poll of 15 analysts. It was also the slowest in over four years or since the 1.6% print in May 2020.

In the first nine months, headline inflation averaged 3.4%, matching the BSP’s full-year forecast.

However, Mr. Tantiangco warned that the growing conflict in the Middle East is a risk for the market. “An escalation of tensions are expected to raise oil prices and cause negative spillovers to the rest of the global economy. It is expected to weigh on sentiment.”

“Chart-wise, the market may continue to test the 7,400 level. If it holds its ground at the said line, this will be considered as its support, while its next resistance is seen at 7,700,” he added.

Meanwhile, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in an e-mail that the PSEi’s immediate support is at 7,060-7,220 and resistance is at 7,552.70-7,800.

For its part, 2TradeAsia.com placed the market’s immediate support at 7,100, primary resistance at 7,500, and secondary resistance at 7,650. — Revin Mikhael D. Ochave

Peso may stay at P56 level as US data dampen hopes of big Fed rate cut

BW FILE PHOTO

THE PESO may stay at the P56-per-dollar level this week after strong US jobs data tempered market expectations of large rate cuts by the US Federal Reserve.

The local unit closed at P56.295 per dollar on Friday, strengthening by 7.5 centavos from its P56.37 finish on Thursday, Bankers Association of the Philippines data showed.

However, week on week, the peso declined by 21.8 centavos from its P56.077 finish on Sept. 27

The peso recovered against the dollar on Friday after September inflation slowed to an over four-year low, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

“The dollar-peso closed lower following the release of lower local inflation data,” a trader likewise said by phone.

Headline inflation slowed to an over four-year low of 1.9% in September from 3.3% in August and 6.1% a year ago, the Philippine Statistics Authority reported on Friday.

This was below the BSP’s 2%-2.8% forecast for the month and the 2.5% median estimate yielded in a BusinessWorld poll of 15 analysts.

The September consumer price index was also the slowest in 52 months or since the 1.6% print in May 2020.

In the first nine months, headline inflation averaged 3.4%, matching the central bank’s full-year forecast and well within its 2-4% annual target.

For this week, the trader said the peso could remain at the P56 level against the dollar following strong September US employment data.

The trader sees the peso moving between P56 and P56.40 per dollar this week.

Meanwhile, Mr. Ricafort expects the local unit to range from P56.20 to P56.40 on Monday.

The dollar jumped to a seven-week high on Friday and was on track to post its best week since September 2022 after a surprisingly strong jobs report for September led traders to cut bets that the Federal Reserve will make further 50-basis-point (bp) rate cuts, Reuters reported.

US nonfarm payrolls increased by 254,000 jobs last month, beating the 140,000 new jobs that economists polled by Reuters had anticipated.

The unemployment rate also unexpectedly slipped, to 4.1% from 4.2% in August.

Improving economic data and more hawkish comments from Fed Chair Jerome H. Powell last week, when he pushed back against expectations of continuing hefty rate cuts, led traders to reduce bets on a 50-bp reduction at the Fed’s next meeting on Nov. 6-7.

Those odds were completely wiped out after Friday’s data. Traders are now pricing in no chance of a 50-bp rate cut, down from around 31% earlier on Friday and 53% a week ago, the CME Group’s FedWatch Tool shows. A 25-bp reduction is seen as almost certain, with traders also seeing a small chance that the Fed will leave rates unchanged.

Bank of America expects the Fed to cut rates by 25 bps per meeting through March 2025, followed by reductions of 25 bps each quarter until the end of 2025, BofA US economist Aditya Bhave said in a report on Friday.

Chicago Fed President Austan Goolsbee called the data “superb” and said more labor market data along those lines would boost his confidence the economy is at full employment with low inflation.

The dollar index reached 102.69, the highest level since Aug. 16, and was on track for its best weekly percentage gain since September 2022.

The dollar has also been boosted by safe-haven demand on concerns about widening conflict in the Middle East. — Aaron Michael C. Sy with Reuters

PHL hoping to wrap up CEPA talks with UAE by early Nov.

REUTERS

THE PHILIPPINES is hoping to conclude negotiations for the Comprehensive Economic Partnership Agreement (CEPA) with the United Arab Emirates (UAE) by early November, the Department of Trade and Industry (DTI) said.

“We want to conclude negotiations by the end of October or first week of November,” DTI International Trade Group Undersecretary Allan B. Gepty told BusinessWorld via Viber.

The Philippines and the UAE are expected to hold the third round of negotiations for a CEPA on Oct. 21-25.

“Our focus there will be on market access negotiations and the remaining issues in the text,” Mr. Gepty said.

Meanwhile, the Philippine Exporters Confederation, Inc. said that the Philippines and the UAE are set to exchange their second requests and offers before the next round of negotiations.

Initially, the Philippines had asked to eliminate nearly 7,000 tariff lines, which account for $700 million or 99.94% of the country’s exports to the UAE.

In turn, the UAE asked for the elimination of 1,400 tariff lines, which account for almost $958 million, or 90.58%, of Philippine imports from the UAE.

Bianca Pearl R. Sykimte, director of the Trade department’s Export Marketing Bureau, said that the Philippines is likely to accept the UAE’s offer to eliminate 4,621 tariff lines, the trade in which was valued at $519 million.

“At the same time, the Philippines will reiterate its request to include key tariff lines initially excluded in the UAE’s initial offer,” she added.

The UAE is the country’s 18th biggest trading partner and top export market in the Gulf Cooperation Council. In 2023, trade between the two countries totaled $1.88 billion. — Justine Irish D. Tabile

DPWH put on notice to improve spending

DPWH

THE Department of Public Works and Highways (DPWH) has been asked to adopt catch-up measures after failing to meet spending targets for its key programs, the Department of Budget and Management (DBM) said.

In its mid-year report, the DBM flagged the DPWH, which has one of the government’s biggest budgets, for falling short of its first-half targets.

“In the first half of 2024, the DPWH… had an average accomplishment rate of only 13%,” the DBM said.

According to the report, the DPWH’s Convergence and Special Support program posted the highest accomplishment rate at 31.3%.

The program aims to extend the length of access roads leading to airports, seaports, tourist destinations, industries, and railway stations. It also seeks to build infrastructure to support National Security roads, among others. 

On the other hand, the Network Development Program had a 0.9% accomplishment rate, the lowest among all programs. It aims to extend the length of newly constructed as well as widened roads.

Other programs that failed to meet the DPWH’s targets include the Asset Preservation Program, the Bridge Program, and the Flood Management Program.

“Given the Department’s low physical performance in the first semester, DPWH is strongly recommended to implement catch-up measures to ensure that the targets for the current year are met by the end of the year,” the DBM said.

According to the DBM, the DPWH should closely monitor project implementation, compare progress against targets, adjust quarterly targets, and address bottlenecks.

As of the end of June, DPWH allotments rose 25.2% year on year to P1.22 trillion. Of the total, P857 billion was obligated while P307.2 billion was disbursed.

The DPWH’s disbursement performance is expected to improve in the second half of the year due to payments and progress billing for completed and ongoing public works, including those initiated and fast-tracked during the dry season, the report said.

Meanwhile, the DBM also noted that the Department of Transportation (DoTr) failed to meet its targets for the Railway Construction, Rehabilitation and Improvement Sub-Program.

This was mainly due to the reduction of programmed appropriations for the DoTr’s foreign-assisted project (FAPs) to P3.5 billion, significantly lower than the P42.9-billion allocation last year.

The program only posted a 47.5% completion rate, against a 60.9% target. Its progress is measured via the percentage completion of both new and expanded railway system projects.

Rail expansion projects also failed to meet the 4.7% completion target, hitting a rate of 4.3%.

“Considering also the releases from the unprogrammed appropriations for support to foreign assisted projects, the DoTr is advised to prepare and implement catch-up plans to achieve the set target for the year,” the DBM said.

Total allotment releases to the DoTr dropped 21.2% to P176.4 billion. — Beatriz Marie D. Cruz

UK offshore wind industry ready to advise Philippines

REUTERS

THE UK is open to working closely with the Philippines in developing its offshore wind resources, noting the country’s many high-potential sites.

British Deputy Ambassador to the Philippines Alistair White said on the sidelines of a conference last week that “the Philippines is showing real ambition and understanding of the urgency of addressing climate change and moving to renewables… I think where the UK and the Philippines can work most closely is potentially UK expertise, particularly in offshore wind. You have a lot of islands, you have a lot of wind from offshore, and the UK has a lot of expertise,” he said, adding that solar is another potential area of cooperation.

Mr. White described the Philippines as a “young market” and “fast-growing economy.”

“There’s a clear need and appetite for foreign investment and partnerships, particularly in the energy sector. I think it’s seen as a very attractive, interesting market,” he said.

He said the UK recognizes the government’s work in minimizing red tape and make the investment climate more attractive.

Philippine offshore wind resource potential has been estimated at 178 gigawatts, according to the World Bank’s 2022 Offshore Wind Roadmap for the Philippines.

During the conference, Mr. White announced that the UK shut down its last coal-fired power station, the first among the Group of Seven (G-7) to do so.

“Just over 10 years ago, the UK still relied on coal for 40% of all of our energy needs, but today we have the largest fixed bottom offshore wind farm in the world and the world’s first floating wind farm. We’ve installed enough solar power to power over three and a half million homes,” Mr. White said.

“And today, the 30th of Sept. 2024, I’m delighted to be able to stand here and say that the UK’s very last coal-fired power station will cease operations,” he added.

Ratcliffe-on-Soar power station in Nottinghamshire shut down late last month ending the over 140-year history of coal power in the UK.

It had a generation capacity of 2,000 megawatts and was capable of producing electricity to power more than two million households, according to Uniper, which owned and operated the station. 

Mr. White said that the UK has been committed to decreasing its fossil fuel generation since around 2008 and has been increasing the mix of renewable energy.

“Our trajectory is continuing the investment in renewable energy towards our net zero target in 2030,” he said at the sidelines.

Asked to comment, Jose M. Layug, Jr., former Energy undersecretary and president of the Developers of Renewable Energy for Advancement, Inc., said via Viber that the UK’s coal phaseout could serve as “a model for the Philippines’ own goal of energy transition: calibrated and responsive.”

Pedro H. Maniego, Jr., senior policy advisor of the Institute for Climate and Sustainable Cities, said that the Philippines has the third-lowest per capita power supply in ASEAN (Association of Southeast Asian Nations) and there needs to be reliable power to step in when it phases out its coal-fired power plants.

“We need reliable and sufficient power for continued economic growth and industrial development. There must be replacement plants for any retired power plants whether coal-fired or not,” he said in a Viber message.

Under the Philippine Energy Plan, the Department of Energy (DoE) plans to study the voluntary retirement and repurposing of coal-fired power plants to ensure a clean-energy transition.

The DoE has set a target of increasing the share of renewable energy in the power generation mix to 35% by 2030 and 50% by 2040. — Sheldeen Joy Talavera

BIR: Incomplete VAT refund claims automatically deemed ‘high risk’

PHILIPPINE STAR/KRIZ JOHN ROSALES

THE Bureau of Internal Revenue (BIR) will now automatically classify value-added tax (VAT) refund claims with incomplete information as “high risk,” subject to full verification.

In a memorandum order, the BIR said incomplete claims include those with no reference details and incomplete or no transaction details on the schedules of sales and purchases.

A VAT refund claim classified as “high risk” would need 100% verification of sales and purchases, according to an earlier memorandum issued by the BIR.

“With the implementation of the risk-based approach in the verification of VAT refund claims, the completeness of the information supplied in the schedules of sales and purchases is very crucial, as the scope of verification varies depending on the claim’s risk classification,” the BIR said.

“Hence, to address the issue of applications with incomplete/missing information on the schedules of sales and purchases, such applications shall automatically be classified as high risk and shall require 100% verification in accordance with the risk-based approach on the verification of VAT refund claims.”

Republic Act No. 11976 or the Ease of Paying Taxes Act applies a risk-based approach in evaluating VAT refund claims. This classifies claimants as low, medium, or high risk.

The risk classification process is determined through a points system that considers the size of the claim; the frequency of claims filed; the claimant’s tax compliance history; and other risk factors.

The BIR also classifies “high risk” claims if they were filed between April 27, 2024 and June 30, 2024; if they were filed by first-time claimants; claims in which the claimant cannot be located; and claimants with complaints before the Justice department or with pending criminal cases, among others.

The BIR identifies a VAT refund claim as low risk depending on the completeness of submitted documents.

A refund claim classified as medium risk is subject to 50% verification of both the sales amounts and total invoices/receipts issued including inward remittances and proof of VAT zero-rating.

The Commissioner of Internal Revenue may determine whether other cases may be deemed high risk, the bureau said. — Beatriz Marie D. Cruz

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