THE Development Budget Coordination Committee (DBCC) slashed the Bureau of Internal Revenue’s (BIR) collection target by 12% this year, as the government expects slower economic growth.
According to Revenue Memorandum Order (RMC) No. 12-2020, which was uploaded on the BIR’s website on Tuesday, the agency’s collection goal was lowered to P2.26 trillion from the previous target of P2.576 trillion.
The BIR now targets to collect P2.206 trillion from its operations, 11.59% lower from the original goal of P2.495 trillion. It also aims to collect P54.584 billion from non-BIR Operations.
The new collection target was approved by the DBCC during its March 26 meeting.
“Collections (target were revised) lower due to lower forecast of gross domestic product (GDP, this year),” Finance Undersecretary Gil S. Beltran said in a mobile phone message.
The government has yet to officially downgrade its growth targets for this year to reflect the economic fallout from the coronavirus pandemic. Luzon, which accounts for over 70% of the country’s gross domestic product, has been under an enhanced community quarantine (ECQ) since mid-March.
Finance Secretary Carlos G. Dominguez III earlier said the economy may contract by one percent or post zero growth this year. The DBCC set a target range of 6.5%-7.5% GDP growth for 2020 last December.
In revising the BIR collection goal, Mr. Beltran said the DBCC also considered lower tax collections from oil products and the change in expenditure priorities of the government.
BIR Deputy Commissioner Arnel SD. Guballa said in a mobile phone message that the DBCC also took into account the ECQ which forced nearly all businesses to temporarily shut down and people were ordered to stay home.
The agency’s tax collection target for the remaining months were revised to: P74.465 billion in April, P320.469 billion in May, P176.39 billion in June, P189.163 billion in July, P189.165 billion in August, P188.19 billion in September, P203.22 billion in October, P259.045 billion in November and P206.389 billion in December.
Preliminary data showed BIR collected P480.64 billion from Jan. 1 to April 17, down by 32% year on year and also short by 45.3% of the P879.18-billion target for that period.
For April alone, BIR only collected P25.01 billion in April 1-17, or 8.66% of its P288.75-billion target for the entire month. This was also 89.5% lower than the P237.93 billion collected in April last year
The lower tax take was attributed to deferment of tax payment deadlines for income tax returns which was moved to May 29 from April 15 initially. Payment deadlines for tax returns were also deferred.
Previously, BIR and the Customs bureau were tasked to collect P3.307 billion this year. — Beatrice M. Laforga