Preliminary data from the Bureaus of Internal Revenue (BIR) and of Customs (BOC) show that their combined revenues from the Tax Reform for Acceleration and Inclusion (TRAIN) Law exceeded estimates for the period January to September 2019.
Total revenues from TRAIN reached P91.3 billion in the first three quarters of 2019, outperforming the collections estimate for the same period of P77.3 billion, said Department of Finance (DOF) Undersecretary Karl Kendrick Chua, enabling the Duterte administration to allocate more funds for its aggressive spending on infrastructure and human capital development.
Chua said actual total revenues surpassed the estimates by P14.1 billion, or 18.2 percent above target.
In terms of its share to the full-year estimate, the reported revenue haul is about 80.8 percent of the projected P113.1 billion tax collections this year.
When compared to the actual TRAIN revenues during the same period last year, this year’s nine-month haul was more than twice the estimated amount, or an increase of 107 percent, Chua said.
“This means we are now closer to completing the 2019 estimates, compared to where we were last year when we were trying to reach the 2018 estimates. This is definitely welcome news, especially for the infrastructure and human development objectives of TRAIN,” Finance Undersecretary Karl Kendrick Chua said.
Both the BIR and the BOC outperformed the government’s estimated collections from TRAIN, as BIR’s TRAIN tax haul exceeded estimates by P9.4 billion, while the BOC exceeded estimates by P4.7 billion.
Major gains during the first three quarters of 2019 came from personal income tax (PIT), imported petroleum excise tax, sweetened beverage (SB) excise tax, tobacco excise tax and the documentary stamp tax (DST), whose total take showed an increase of P42.4 billion.
“As you know, one of the most significant provisions of TRAIN was the lowering of PIT. Losses from this adjustment were originally estimated at P96.4 billion, but actual losses were lower at P79.2 billion, or a savings of P17.2 billion. This was a result of better compliance, higher employment rate resulting in an increase in registered taxpayers, and lower unemployment and underemployment rates,” Chua explained.
“Imported petroleum excise tax collections were above estimate by P14.3 billion, owing to higher-than-programmed volume of imported finished petroleum products, particularly diesel and gasoline. The overperformance is also evident in the overall BOC petroleum excise revenues for the first three quarters at P64.5 billion, which is more than double than the P31.2 billion recorded during the same period last year,” Chua added.
“Clarity in the implementation of the SB excise tax also improved revenue performance. The issuance of a revenue regulation that provided clear guidelines for the SB excise tax led to better compliance by the industry. The SB excise tax was above the estimate by P1.9 billion with both BIR and BOC exceeding their goals,” Chua said.
Meanwhile, the tobacco excise tax take was also above estimate by P4.4 billion, a performance Chua attributed to “better compliance as the government sustained its crackdown on the illicit tobacco trade.”
DST earnings were likewise above estimate by P4.7 billion, as a result of “higher transaction value and better collection efficiency,” he said.
Shortfalls, however, were seen in the collected excise taxes from automobiles and locally refined petroleum products, with their combined take short of the estimate by P25.2 billion. However, this is lower than the gain from other ta types.
“Automobile excise tax earnings were short by P11.3 billion owing to lower import volume. This was seen, too, in the overall BOC automobile excise tax collections, which totalled P23.8 billion below the estimate and lower than last year’s take by 29.4 percent,” Chua said.
“The excise tax collections from locally refined petroleum products was short by P13.9 billion because of to the decline in the volume of removals, and the shift to imported finished products,” Chua added.
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