Rebound in excise tax collections seen starting 2021
THE government expects excise tax collection on goods to bounce back next year as economic recovery is seen picking up from this year’s slump.
The Bureau of Internal Revenue (BIR) aims to collect P432.807 billion in excise taxes in 2021, up 51% from this year’s already revised P286.57-billion target, according to the latest Budget of Expenditures and Sources of Financing (BESF).
However, the target is still 16% lower than the P517-billion excise tax goal penciled in before the coronavirus pandemic hit.
Broken down, the BIR is expected to collect excise taxes worth P204 billion from tobacco products; P114 billion from alcohol products; P48 billion from fuel; P40 billion from sweetened beverages, P7.1 billion from mining; P2.7 billion from automobiles, among others.
For 2022, the BIR’s goal is to collect P540.2 billion in excise taxes on goods, but is still 8% lower than the pre-pandemic estimate of P588.29 billion.
The bureau targets to generate P271 billion from excise taxes on tobacco products; P129 billion from alcohol products; P50 billion from fuel; P43 billion from sweetened beverages, P8.2 billion from mining, and P3.1 billion from automobiles.
The projected excise tax collections in 2021-2022 are seen rebounding from the P286.576 billion goal for this year, which was revised from the P193.757-billion goal adopted in May.
However, this is still a fifth smaller than the initial P360-billion goal set prior to the coronavirus pandemic and 10% lower than the P317.27 billion it collected last year.
The estimated excise tax revenues already included proceeds from the measures under the Comprehensive Tax Reform Program.
Economic managers slashed revenue targets over the near term because of the expected sluggish economic activity, said Finance Undersecretary and Chief Economist Gil S. Beltran in a text message on Wednesday.
The economy plunged into recession in the second quarter, and is seen to further shrink by as much as 6.6% by yearend. In 2021-2022, gross domestic product (GDP) is expected to bounce back by 6.5-7.5%. — Beatrice M. Laforga
