Government to go after pros, self-employed

By Iris C. Gonzales, The Philippine Star

Posted at Jul 13 2011 07:21 AM | Updated as of Jul 13 2011 03:21 PM

MANILA, Philippines - The Aquino administration will step up efforts to go after professionals and self-employed individuals as part of efforts to improve revenue-to-gross domestic product (GDP) ratio by 4%, Finance Secretary Cesar Purisima said yesterday.

“We are zeroing on the self-employed sector,” Purisima said.

He noted that there are roughly 1.7 million taxpayers under this segment.

In 2010 alone, the group remitted P9.8 billion in taxes

Purisima said this is in line with the Aquino administration’s thrust to improve tax administration instead of slapping new taxes.

“We support President Aquino’s program to improve tax administration,” Purisima said.

Quoting the World Bank, Purisima said there is room to improve the country’s revenue-to-GDP ratio by 4%. Revenue-to-GDP ratio has averaged roughly 14% from 2006 to 2010.

Purisima believes that if the government is able to raise collections from these individuals to at least P200,000 each, total tax collections would significantly increase.

As such, there would be stricter monitoring of the income-generating activities of these individuals.

Professionals and self-employed individuals such as doctors and lawyers do not always issue receipts, based on the findings of the Bureau of Internal Revenue (BIR).

Last May, the agency collected P88.15 billion or 1.7% below the target of P89.72 billion for the period.

The May collections brought the BIR’s five-month revenues to P391.09 billion, 13.7% or P46.99 billion higher than the year-ago collections of P344.10 billion.