MANILA = There were no negative votes or abstentions when 250 House of Representatives lawmakers voted to approve House Bill 4125 or the proposed Ease of Paying Taxes Act on third and final reading.
According to the congressional fact sheet prepared by the House Ways and Means Committee, the bill would institutionalize simplified tax returns and processes for smaller taxpayers for ease of compliance to tax rules and regulations.
It also introduces a medium taxpayer classification and a corresponding Bureau of Internal Revenue (BIR) special unit for better service and tax administration.
It also enhances the portability of tax transactions by removing restrictions on venue in the filing of returns and payment of taxes.
It removes the distinction between sales invoices and official receipts and makes the former the document to be used by taxpayers to substantiate value-added tax (VAT) transactions whether for sale of goods or services.
It mandates the Commissioner of Internal Revenue to ensure the creation of registration facilities for non-resident taxpayers.
It removes the required annual taxpayer registration fee payment worth Five Hundred Pesos and legislates a Taxpayer's Bill of Rights and designates a Taxpayers' Advocate Office.
When the bill was sponsored for plenary deliberations, House Ways and Means Committee Chair, Albay 2nd District Rep. Joey Salceda said that the tax administration efficiency resulting from the passage of this measure shall yield an estimated P73.1 billion additional revenues over a period of five years.
"We also expect to reduce opportunities for corruption and improve taxpayer experience through the modernization of tax administration procedures. We aim to boost taxpayer morale by building trust and legitimacy between the government and taxpayers, as this will ultimately translate to more services for our people," Salceda said.
Salceda said tedious tax administration results in lower ease of doing business.
"In the World Bank Enterprise surveys, tax rates and tax administration are among the major constraints firms face in their everyday operations. This is in large part because of the one-size-fits-all approach given to the currently limited classification of taxpayers despite differences in capacity to comply with tax requirements. The pandemic further magnified these tax compliance constraints. While the BIR is transitioning into digitizing its services, we must ensure that procedures for taxpayers are not tedious," Salceda said.
The House will submit the bill to the Senate for action.