The Philippines’ 20 Most and Least Proﬁtable Companies in 2023

January 20, 2025 | 12:00 am

The 2024 edition of BusinessWorld Top 1000 Corporations in the Philippines contains the country’s largest companies with a combined net income of P2 trillion in 2023. This infographic shows the 20 companies with the best and worst bottom lines in 2023.

The BusinessWorld Top 1000 Corporations in the Philippines can be purchased directly by reaching out to BusinessWorld’s Circulation Department at (+63 2) 8527-7777 locals 2651 to 2654 or via e-mail at circ@bworldonline.com. The portable document format (PDF) version will also be available for purchase at https://bworld-x.com/.

Market to remain cautious with Trump in focus

January 19, 2025 | 9:00 pm

PSE-building — The lobby of the Philippine Stock Exchange in Taguig City, Sept. 30, 2020. — REUTERS

PHILIPPINE SHARES may remain weak this week as market sentiment stays cautious, with US President-elect Donald J. Trump set to take office on Monday and amid the absence of fresh catalysts.

On Friday, the benchmark Philippine Stock Exchange index (PSEi) rose by 1.38% or 86.60 points to 6,352.12, while the broader all shares index increased by 0.76% or 27.95 points to 3,703.73.

However, week on week, the PSEi fell by 2.22% or 144.20 points from its 6,496.32 finish on Jan. 10, marking its second straight weekly decline.

“Local equities tracked regional peers, succumbing to profit-taking ahead of Mr. Trump’s inauguration. Shaky global capital markets were gripped by politico-economic anxiety,” online brokerage firm 2TradeAsia.com said in a market note. “Apart from uncertainties in trade, immigration, and taxation, the overall well-being of the US economy has been sending pain signals to the rest of the globe.”

“The local market has turned more bearish as it extended its decline. At the same time, the market has broken below the 6,400 level, which previously served as a support line,” Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco said in a Viber message.

The week saw the benchmark index fall to the 6,200 level twice as the release of key US inflation reports caused markets to recalibrate their Federal Reserve policy easing expectations.

On Thursday, the PSEi sank to 6,265.52, which was its lowest close in nearly seven months or since it ended at 6,158.48 on June 21, 2024.

For this week, Mr. Trump’s inauguration will likely be a key source of leads for the market, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

“We still expect the cautious atmosphere to remain in the local bourse amid the lack of fresh leads. Investors are expected to wait for new catalysts. Until then, cues are expected to come from other financial markets,” Mr. Tantiangco said.

“We may also see episodes of bargain hunting given that the local market is still at attractive levels, fundamentally speaking,” he added, putting the PSEi’s support at 6,150 and resistance at 6,400.

For its part, 2TradeAsia.com placed the market’s support at 6,000 and resistance at 6,500.

Mr. Trump arrived in the Washington area on Saturday evening for a celebration of his return to power, Reuters reported.

In the Capitol Rotunda, Mr. Trump will be sworn in at 12 p.m. ET (1700 GMT) then deliver an inaugural address, a speech that typically sets the tone for the president’s four-year term. He told NBC News the theme would be “unity and strength, and also the word ‘fairness.’”

Once he returns to the White House on Monday afternoon, Mr. Trump is expected to begin signing dozens of executive orders and directives to crack down on migration, boost US energy production and other priorities. — Revin Mikhael D. Ochave with Reuters

Peso may be range-bound as markets await Trump policies

January 19, 2025 | 9:00 pm

THE PESO may move sideways against the dollar this week as the market awaits US President-elect Donald J. Trump’s inauguration for potential policy pronouncements.

The local unit closed at P58.64 per dollar on Friday, slipping by three centavos from its P58.61 finish on Thursday, Bankers Association of the Philippines data showed.

Week on week, the peso likewise depreciated by 28 centavos from its P58.36 finish on Jan. 10.

The peso consolidated against the dollar on Friday before Mr. Trump’s inauguration, a trader said in a phone interview.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort likewise said in a Viber message the peso-dollar pair moved sideways as markets await hints on the Trump administration’s policy stance and amid elevated global crude oil prices recently.

Policy comments from US Federal Reserve officials also caused market volatility, he added.

For this week, the trader said the peso will continue to be range-bound as global markets await the start of Mr. Trump’s second term.

The trader sees the peso moving between P58.40 and P58.80 per dollar this week, while Mr. Ricafort said it could range from P58.30 to P58.80.

The dollar held gains against the yen on Friday, but ended the week lower after a six-week winning streak, as investors await Mr. Trump’s presidential inauguration and clarity on the course of the incoming administration’s policies, Reuters reported.

The yen was poised for its strongest weekly performance in over a month as expectations for a Bank of Japan rate hike this week grow, putting the dollar on the back foot.

It climbed more than 1% against the dollar last week and touched a one-month high of 154.98 per dollar earlier on Friday.

The greenback was last up 0.68% against the yen at 156.165.

Remarks from Bank of Japan officials along with Japanese data that point to persistent price pressure and strong wage growth have helped boost market confidence that a rate shift is in the offing, with traders pricing in an 80% chance of a hike this week.

Sources also told Reuters that the central bank is likely to hike rates this week barring any market shocks when Mr. Trump takes office.

The dollar index rose on the day but showed a weekly decline after a six-week winning streak, as investors awaited the inauguration, with hopes for more clarity on policy.

The dollar index, which measures the greenback against a basket of currencies including the yen and the euro, rose 0.37% to 109.37.

The dollar has surged in the past few weeks on the back of rising Treasury yields, reflecting expectations that Mr. Trump’s policies could boost inflation when the US economy is already strong.

But bond markets got relief from a relentless selloff after softer US core inflation data on Wednesday, plus remarks from Federal Reserve Governor Christopher Waller on Thursday, who said three or four interest rate cuts were still possible this year if the data supported that.

This led markets to up their bets on Fed cuts this year, putting some pressure on the dollar ahead of Mr. Trump’s return to the White House.

Money markets currently price in about 40 basis points in US rate cuts in 2025.

Investors are now awaiting Mr. Trump’s inauguration speech on Monday to get a better sense of his policy steps and expecting volatility. — AMCS with Reuters

Digital VAT draft regulations to allow 3^rd party local reps

January 19, 2025 | 8:32 pm

THE Bureau of Internal Revenue (BIR) will allow non-resident digital service providers (DSPs) to appoint a local third-party representative to handle administrative matters for them with regard to the value-added tax (VAT) law.

“In registering with the BIR, a nonresident DSP need not have a local representative in the Philippines,” the BIR said in a version of the implementing rules and regulations (IRR) dated Jan. 17.

The 10-page draft IRR previously required an in-country representative upon registering for Republic Act 12023 or the VAT on digital services law.

“However, it may appoint a resident third-party service provider (an individual or entity, such as a law firm, accounting firm, or consultancy firm) for purposes of receiving notices, record keeping, filing of tax returns, and other reporting obligations,” it added.

The nonresident DSP is required to notify the BIR in writing of the designated representative within 30 calendar days from the date of appointment.

For VAT purposes, the appointment of a third-party service provider does not classify the nonresident DSP as a nonresident foreign corporation doing business in the Philippines, according to the draft.

Unregistered non-resident DSPs face suspension of business operations in the Philippines and other penalties, the BIR said.

The Department of Finance (DoF) has said it expects to collect P7.25 billion in 2025 from VAT on DSPs and P21.37 billion in the next year.

The VAT on digital media and advertising is projected to bring the government P102.12 billion in revenue by 2029, a DoF official said.

The VAT scheme is scheduled to go live on March 31. — Aubrey Rose A. Inosante

Finland signals need for tech, healthcare workers

January 19, 2025 | 8:32 pm

FINLAND’s ageing population has created gaps in its workforce that Filipinos can fill, particularly in technology and healthcare, members of a Finnish delegation said.

“Finland, like most of the European countries, has this challenge that we are an ageing nation. We do not have enough kids coming to the labor market in the future,” Laura Lindeman, senior director and head of Work in Finland, told reporters late Thursday.

“But it is not only that we lack pairs of hands or we have gaps in the labor market, but it is also that international talent bring added value to Finnish companies because they can open connections, and diversity boosts innovation,” she added.

A Finnish delegation led by Finland’s Minister of Employment, Arto Olavi Satonen, visited the country between Jan. 16 and 18.

“We have more than 50 people from Finland. So it is a huge delegation that tells that Finland really sees the Philippines as a very interesting market,” she said.

According to Ms. Lindeman, the specific niches Filipinos can fill include information technology specialists, welders, nurses, caregivers, and restaurant and tourism employees.

By 2040, she said that Finland will need 1.37 million new workers, only part of which will be serviced by Finnish workers.

“On an annual basis, that is about 60,000, and some of that need is met with local labor. The gap is 20,000 per year. So that would be kind of the big picture estimate of the need for international workers,” she added.

The Finnish government is focusing on four countries for international recruitment — the Philippines, Vietnam, India, and Brazil.

Meanwhile, she said that the governments of the Philippines and Finland are discussing how to digitalize migration processes, which may help expedite the recruitment process for Finnish firms.

“We have already agreed on more detailed discussions on how Finland could actually help in digitalize the migration process here because we have learned that it is very time-consuming to work with papers in the process,” she said.

“In Finland, the migration process has been digitalized thoroughly. Almost everything is automated, so hopefully there could be some collaboration,” she added.

Work in Finland has nine private recruitment partners in the Philippines that interested workers can contact. These include IPAMS, Premier Global, Perpetual Help Placement Services, Staffhouse, and GROW, Inc.

During Mr. Satonen’s visit, the Department of Migrant Workers and Finland’s Ministry of Economic Affairs and Employment signed a declaration of intent to ensure Filipino worker safety and ethical deployment.

“That is the first step … I assume that usually the next step is that more negotiations will come out of that and that it might lead to a memorandum of understanding,” Ms. Lindeman said.

According to Mr. Satonen, there were 12,770 Filipino workers in Finland as of 2023 performing healthcare, technology, services, and industrial work. — Justine Irish D. Tabile

SB Corp. targets P460M in operating income this year

January 19, 2025 | 8:32 pm

THE Trade department’s micro, small and medium enterprise development financing arm, Small Business Corp. (SB Corp.), has set a target of P460 million in net operating income this year after setting a record in 2024.

On the sidelines of a briefing on Friday, SB Corp. President Robert C. Bastillo said the company’s 2025 target is double the 2024 goal.

“The target is still over P400 million,” Mr. Bastillo said, adding that the company will seek to stretch performance to as much as P500 million.

If net operating income hits P500 million, it would represent a 15.9% increase from the P431.1 million booked last year.

The 2024 result was nearly double the performance of the last full pre-pandemic year, when it booked P228.6 million.

He said the revenue target is P1.2 billion in 2025, which would represent a 20% increase from the 2024 performance.

“The corporate losses of the past few years were largely due to SB Corp.’s countercyclical role in the Philippine financial system and prudent provisioning for the mandated COVID-related accounts,” Mr. Bastillo said.

“However, we believe that the corporation’s performance in 2024 signals a new chapter of growth and financial sustainability,” he added.

According to SB Corp., the positive results can be attributed to streamlined and faster loan application and approval processes, enhanced governance, and a commitment to financing 100% of all approved loan applications.

SB Corp. lent to over 61,000 businesses last year, with a target of at least 65,000 businesses in 2025.

On Friday, the Department of Trade and Industry and SB Corp. announced the launch of three more lending programs due to be up and running next month.

These are the receivables financing (P200 million), Creative Industry Fund (P500 million), and Halal Financing (P500 million) programs.

SB Corp.’s other loan programs are Enterprise Rehabilitation Financing (P2 billion), Franchise Funding (P1 billion), Business Expansion Financing (P1 billion), Regular Business Loan (P3 billion), and Purchase Order Financing (P500 million). — Justine Irish D. Tabile

Canning raw material tariff cut seen reducing prices of canned goods

January 19, 2025 | 8:31 pm

Mega manufacturing plant-worker — A worker is seen inside the new Mega manufacturing plant in Sto. Tomas, Batangas, March 1, 2023. — PHILSTAR/KRIZ JOHN ROSALES

REDUCING the most favored nation (MFN) tariff rate on tin-mill black plates (TMBPs) is expected to boost domestic production of tin plate and tin-free steel, possibly leading to reduced canned goods prices, the Tariff Commission heard.

At a public hearing on Friday, Perstima (Philippines), Inc., sought the reduction of the MFN tariff rate for TMBPs.

TMBPs are primarily used in the production of food cans, beverage cans, paint cans, and industrial cans.

Perstima, the sole manufacturer of tin plate and tin-free steel in the Philippines, currently imports 77% of its TMBP needs from Japan.

“The TMBP supply from Japan is very limited. And now our operation rate is around 30% or 40% of capacity. So we are thinking we want to increase our utilization rate,” according to Kai Adachi, Perstima sales manager.

“In order to do that, we need more TMBP from countries other than Japan, so a 3% (tariff) reduction on TMBPs from Taiwan and China is really important for us,” he added.

Perstima is a Philippine Economic Zone Authority-registered business enterprise in LIMA Estate. Its plant has the capacity to produce 200,000 metric tons of tin plate annually.

Between 2021 and 2024, source countries for TMBPs were Japan (77%), Taiwan (19%), China (3%), and South Korea (1%). Imports of TMBPs from Japan and South Korea are zero-duty, while Taiwan and Chinese TMBPs are subject to 3% duty.

According to Perstima, reducing the tariff rates on TMBP will not affect domestic industry.

“There are no domestic manufacturers in the Philippines that would be adversely affected by the tariff reduction,” it said. — Justine Irish D. Tabile

Offshore wind to add 16 GW in new capacity — Energy dep’t

January 19, 2025 | 8:30 pm

THE Department of Energy (DoE) said it is projecting more than 16 gigawatts (GW) of new capacity from offshore wind power projects.

The DoE said it is currently assisting 16 offshore wind proponents who committed to start construction by 2027 and to deliver the first kilowatt-hour by 2028.

The largest project is Domhain Earth Corp.’s Bulalacao Offshore Wind Farm in Oriental Mindoro and Antique with capacity of 3,100 megawatts (MW).

Other large-scale projects are the 1,830-MW Calatagan Offshore Wind Farm in Batangas and Mindoro; the 1,600-MW Claveria Offshore Wind Farm in Ilocos Norte and Cagayan; and the 1,500-MW Mariveles Offshore Wind Farm in Bataan, Cavite and Batangas.

The DoE has also recognized BuhaWind Energy Northern Luzon Corp.’s 2,000-MW Northern Luzon Offshore Wind Power Project in Ilocos Norte as a so-called “frontrunner project.”

Other offshore wind project include CI NMF (PH) Corp.’s 1,000-MW San Miguel Bay Offshore Wind Power Project in Camarines Norte and Camarines Sur; the 650-MW Samar Norte Offshore Wind Power Project in Northern Samar; and the 350-MW Dagupan Offshore Wind Power Project in Pangasinan and La Union.

The other frontrunners include Vind Energy Corp.’s 994-MW Cavite Offshore Wind Project and the 728-MW GS2 Offshore Wind Power Project in Guimaras; Triconti SouthWind Corp.’s 600-MW Guimaras Strait Wind Power Project; and Jet Stream Windkraft Corp.’s 600-MW Guimaras Strait II Wind Power Project.

Also designated frontrunner projects are Ivisan Windkraft Corp.’s 450-MW Frontera Bay Wind Power Project in Bataan and Cavite and ACX3 Capital Holdings, Inc.’s 500-MW San Miguel Bay Wind Power Project in Camarines Sur, 475-MW Lucena Wind Power Project in Quezon, and 275-MW Tayabas Bay Wind Power Project in Quezon.

The DoE is hoping to stage the fifth round of the green energy auction (GEA-5) focused on offshore wind power this year, Undersecretary Rowena Cristina L. Guevara said.

“We announced this in December because some of the front-runner offshore wind projects needed to assure their investors that the Green Energy Auction 5 is going to happen,” Ms. Guevara told reporters last week.

GEA-5 is expected to secure market access for offshore wind developers, ensuring long-term demand for their generation capacities and keep them on track to generate the first kilowatts by 2028.

The government had awarded 92 offshore wind contracts with 68-GW potential capacity as of October. Of the total, 21 contracts were awarded to foreign-owned companies with an aggregate capacity of 19.2 GW.

However, for these projects to be realized, ports need to be developed to serve as logistics hubs throughout the lifecycle of the projects.

Ms. Guevara said that transmission and ports are the crucial components of offshore wind development. The DoE is currently working with the National Grid Corp. of the Philippines for the transmission and local government units for right of way.

The department is also in talks with the Department of Environment and Natural Resources (DENR) and the Philippine Ports Authority (PPA).

The PPA has committed and allocated a budget for repurposing and expansion of three priority ports. Due to their proximity to high-potential wind energy service contracts, Currimao port in Ilocos Norte, the Port of Batangas, and the Jose Panganiban port in Camarines Norte have been identified as critical to offshore wind development.

In October, the DoE and the DENR signed a memorandum of agreement allowing access to both offshore and auxiliary areas during the pre-development/exploration, development and commercial development phases, subject to the necessary DENR requirements.

“Our move is really coordinated because we want to succeed,” Ms. Guevara said.

The Philippines’ offshore wind resources are estimated at a potential 178 GW, according to the World Bank’s 2022 Offshore Wind Roadmap for the Philippines. — Sheldeen Joy Talavera

Commercial vessels could deplete fish stocks in municipal waters — NGO

January 19, 2025 | 8:30 pm

Tuna-fisherman — PHILIPINE STAR/ RYAN BALDEMOR

OCEANA Philippines warned of the potential depletion of fish stocks after a Supreme Court (SC) resolution allowing commercial fishing operations in municipal waters.

“We are worried that this court decision will result in the depletion of our fish stocks with the unabated fishing operations of commercial fishers, displacement of our small, municipal fisherfolk, and destruction of marine habitats and spawning grounds of juvenile fish needed to restore our fisheries,” Oceana Vice-President Gloria E. Ramos said in a statement.

The SC’s First Division upheld a Malabon Regional Trial Court ruling declaring the Fisheries Code’s preferential access provisions unconstitutional.

Under the Republic Act No. 10654, or the Amended Fisheries Code of the Philippines, commercial fishing vessels are only allowed to operate outside a 15-kilometer zone designated as municipal waters.

Oceana said 533 out of 884 coastal towns in the Philippines will now have to open up 90% of their municipal waters to commercial fishing vessels.

“All these will push back the reforms for science-based fishery management areas system now in place, rendering irrelevant the vessel monitoring requirement for commercial fishing vessels,” Ms. Ramos added.

She said that the move could also lead to “deeper hunger and poverty” among small-scale fisherfolk due to more intense competition.

In a statement over the weekend, the Department of Agriculture said that it was urging the High Court to reconsider its decision.

“At a depth of seven fathoms, or 12 meters, corals are at risk, and our scarce marine resources could face further depletion,” Agriculture Secretary Francisco P. Tiu Laurel, Jr. said during a meeting with fishing industry representatives.

The volume of fish catch delivered to regional ports declined by 11.5% to 42,445.26 metric tons in December, according to the Philippine Fisheries Development Authority. — Adrian H. Halili

Supply chain disruptions, skills gap expected to delay PHL AI adoption

January 19, 2025 | 8:26 pm

AI-Artificial intelligence-robot — FREEPIK

By Beatriz Marie D. Cruz, Reporter

THE Philippines’ adoption of artificial intelligence (AI) this year are expected to be hampered by supply chain vulnerabilities and the digital skills gap, according to software firm Hitachi Vantara.

“Supply chain issues are a significant challenge in adopting AI technologies, and the Philippines is no exception,” Matthew Hardman, chief technology officer for Asia-Pacific at Hitachi Vantara, said in an e-mail.

“These challenges manifest in several ways, including difficulties in accessing hardware, software, talent, and regulatory frameworks needed to build and sustain AI systems effectively.”

Around 54% of organizations globally identified supply chain challenges as the biggest barrier in achieving cyber resilience, according to the World Economic Forum’s Global Cybersecurity Outlook for 2025.

“Supply chain disruptions, like the global semiconductor shortage, have made this hardware more expensive and less predictable. For the Philippines, which is still developing its digital infrastructure, this poses a significant barrier to scaling AI solutions,” Mr. Hardman added.

While the Philippines is making steady progress in adopting AI, its adoption rates and maturity levels lag those of its regional counterparts like Malaysia and Singapore, he also said.

Compared to its ASEAN (Association of Southeast Nations) peers, the Philippines’ AI adoption remains hampered by limited talent, a fragmented digital infrastructure, and lower public and private sector investment in research and development, Mr. Hardman said.

To strengthen AI adoption this year, businesses must consider partnering with a reputable data infrastructure companies to gain access to advanced tools, expertise, and best practices in data management.

Mr. Hardman also cited the need for increased public-private partnerships, streamlined regulatory frameworks for data sharing and AI adoption, and expanded AI-focused education and training.

“Strengthening the digital backbone, including broadband connectivity and local manufacturing of critical components, can help to reduce reliance on international supply chains and support the seamless operation of AI systems,” he also said.

Preliminary 2026 budget activities set for late January — Budget dep’t

January 19, 2025 | 8:25 pm

THE Department of Budget and Management (DBM) said it will convene with government representatives and state-run firms in a series of budget forums later this month in preparation for drafting the 2026 budget proposal.

In a circular dated Jan. 15, Budget Secretary Amenah F. Pangandaman announced that the budget forums will take place at the Philippine International Conventional Center.

For the heads of budget, accounting, and planning units of National Government Agencies (NGAs) and Government-Owned or Controlled Corporations (GOCCs), both forums will be held on Jan. 28.

“State Universities and Colleges (SUCs) under the coverage of the DBM Regional Offices (ROs) are excluded from the target attendees. A separate forum will be conducted by their respective RO counterparts,” Ms. Pangandaman said.

On the first week of January, the DBM issued National Budget Memorandum No. 153, signaling the preparatory stage for drafting the National Expenditure Program and outlining the priorities for next year.

The Development Budget Coordination Committee set a P6.54-trillion spending target for 2026. It also projected that revenue will hit P5.063 trillion or 16.2% of gross domestic product next year. — Aubrey Rose A. Inosante

Ease of doing business: The BIR 2028 DX Roadmap

January 19, 2025 | 8:24 pm

IN BRIEF:

• The BIR’s Digitalization Program aims to modernize and enhance the efficiency, transparency, and effectiveness of tax administration and revenue collection processes.

• The BIR envisions taxpayers as customers, adopting taxpayer-centric views in their services. Completed projects reflecting this approach include the Online Registration Update System (ORUS), Enhancement of the Electronic One-Time Transaction (eONETT) System, and the Optimized Knowledge Management System for Chatbot Revie.

• Despite foreseeable challenges such as increased security risks and budget constraints, the BIR is prepared to address them by focusing on system upgrades, modernization, and adhering to its vision of collecting taxes through the just enforcement of tax laws.

Change is inevitable in today’s dynamic environment. To keep pace with rapid modernization, organizations must evolve their offerings to meet public needs. On Jan. 8, a key official of the Bureau of Internal Revenue (BIR) shared insights at the 3^rd Tax Symposium of SGV, discussing how the BIR is adapting to modernization and transforming its services to meet the evolving needs of taxpayers.

EVOLUTION OF THE BIR DX ROADMAP
The BIR revitalized its digital transformation journey with the issuance of Revenue Memorandum Order (RMO) No. 27-2020, known as the BIR Digital Transformation (DX) Roadmap 2020-2030. This initiative was pursued in compliance with Republic Act No. 11032 or the Ease of Doing Business and Efficient Government Service Delivery Act of 2018, which requires government offices to assess and improve their transaction systems and procedures. The DX Roadmap is built around three core principles: adopting a people-first approach, instituting a process perspective, and embracing digital technology, with a digital transformation mindset as its foundation.

Recognizing the need for a more comprehensive and updated roadmap, the BIR issued RMO No. 48-2024, known as the Adoption of the New BIR Digital Transformation Roadmap for CY 2025-2028. This initiative aligns with Section 43 of RA No. 11976, or the Ease of Paying Taxes Act, which requires the BIR to adopt an integrated digitalization strategy by providing automated end-to-end solutions for taxpayers. The roadmap also reflects BIR Aspiration 2028, which envisions the BIR as highly digital and propelled by empowered revenue officers with integrity, providing excellent services aligned with international tax standards.

PROJECT UPDATES
The speaker emphasized that despite recent legislation requiring the digital transformation of BIR services, the BIR has long been committed to making its services convenient and efficient for the public. This commitment is evident in the expansion of eServices and the leveraging of technology for a robust tax administration.

It was highlighted that during the time when the world stood still due to the COVID-19 pandemic, the BIR’s Electronic Filing and Payment System (eFPS), e-BIR Forms, and electronic payment facilities were already in place. This allowed taxpayers to efficiently comply with their filing and payment duties.

A report on the status of projects under the BIR DX Program for CY2024 as of Nov. 30, 2024 was also presented. There are eight completed projects and eight ongoing projects.

Completed projects include the Online Registration Update System (ORUS), Enhancement of the Electronic One-Time Transaction (eONETT) System, Optimized Knowledge Management System for Chatbot Revie, Property Management System (PMS) (National Office Phase), Expansion of Digital Platform and Tools, Establishment of a Command Center with IT Operations Center, Enterprise Risk Management (ERM), and Enhanced Monitoring and Managing Administrative Cases (EMMAC).

Meanwhile, ongoing projects include the Project 230X, Electronic Tax Clearance System (eTCS), Electronic Invoicing/Receipting and Sales Reporting System (EIS/SRS), eAppointment (BIR Services under Assessment and Collection Service, Development of Cloud Based Electronic Documentary Stamp Tax (eDST) System, Document Tracking Management System (DTMS), Cybersecurity Program and Internal Revenue Integrated System (IRIS).

Eleven other projects under the DX Program are in varying stages of project planning and execution. These include taxpayer-facing projects as well as projects for internal customers.

A notable highlight of the DX project is the EIS/SRS Program. Republic Act No. 10963 or the Tax Reform for Acceleration and Inclusion Law (TRAIN Law) authorized the establishment of a system capable of storing and processing the required data within five years from the effectivity of the Law. Republic Act No. 12066 or the CREATE MORE Law removed the five-year implementing period. In terms of updates, out of the 100 Pilot Taxpayers, 63 are currently transmitting their sales data.

The ongoing Tax Modernization Feasibility Study Project will determine the best way forward for the EIS/SRS program. The study’s result will be out towards the end of the first quarter of 2025. By then, the Bureau can provide firmer guidelines and timelines regarding the EIS/SRS implementation.

Further, under the CREATE MORE Law, taxpayers under the jurisdiction of the Large Taxpayer Service and exporters are still covered both by the requirement of issuing electronic invoices (EIS) and electronic reporting of their sales (SRS) data to the Bureau. What was amended is that those engaged in e-commerce are only required to comply with the EIS, but it is not mandatory for them to comply with the SRS program. Instead, they may opt to voluntarily comply.

Meanwhile, other taxpayers may voluntarily issue electronic invoices and use an SRS. Those who volunteer will be granted incentives, specifically an additional deduction from taxable income of 100% total cost for setting up an EIS/SRS for taxpayers classified as micro and small and an additional 50% for medium and large, which can only be availed of once.

MODERNIZING TAX SERVICES
Transformation is not just about modernization. It aims to establish a more efficient, transparent, and responsive tax administration capable of addressing the changing needs of the public.

As the BIR strives for transformative and modernized services for taxpayers, it acknowledges foreseeable challenges such as increased security risks, budget constraints, customer/taxpayer readiness, among others. Nonetheless, the BIR is prepared to address these challenges.

These developments in the BIR’s DX Program give taxpayers a renewed optimism recognizing the significance of its successful implementation in improving tax processes towards realizing BIR’s vision of a modern, efficient, and technology-driven tax system that benefits both the taxpayers and government.

This article is for general information only and is not a substitute for professional advice where the facts and circumstances warrant. The views and opinions expressed above are those of the authors and do not necessarily represent the views of SGV & Co.

Thyrza F. Marbas is a tax partner and Rule Amethyst L. Oporto is a tax senior manager of SGV & Co.