Bureau of Internal Revenue
Republic of the Philippines


Annual
Report

2000
1999

 

 

 

 

Highlights 2000 | Collection Performance | Tax Returns Filed | Revenue Programs | Tax Statistics

BIR COLLECTION PERFORMANCE, CY 2000

Overall Performance

The CY 2000 total internal revenue of P 360.802 B surpassed its 1999 collections by P 19.482 B despite the continuing effect of the economic and political crisis. Compared to the bureau’s goal of P 397.764 B, this year’s total revenue collection represented a 90.71% level of attainment.

 

As reported by the National Statistics Coordination Board (NSCB), GDP at current prices for CY 2000 posted a 10.9% growth which is lower than the 11.7% growth recorded in CY 1999.  The growth of the industry sector contributed positively to the collection of the bureau with at least two (2) subsectors initiating gains in tax collections.  The transport and communication sector which grew by 24.9% in 2000 compared to 14.1% in 1999 while the manufacturing sector exhibited a 15.8% growth this year vis-a-vis 10.5% growth last year.

The BIR’s share to the total National Government Tax Revenue of 460.034 B  reached 78.43%.

The Bureau realized a tax effort of 10.92% in 2000.

COLLECTION BY MAJOR SOURCES

Taxes on Net Income and Profit registered the highest contribution at 56.50% of the total tax revenues followed by Excise Taxes and Value Added Taxes at 17.09% and 14.75% shares, respectively.

 

Collection from Taxes on Net Income and Profit and Other Percentage Taxes exceeded the 1999 collection while Value Added Taxes, Excise Taxes and Other Taxes did not surpass previous year’s collection. Shown below is the table on the comparative collection and goal for CY1999-2000.

 

Income tax collections performed positively compared to 1999 by P 19.482 B or 10.77%. This could be credited to:

  • Robust growth in collection from P 3.567 B last year to P 5.766 B this year from  the communication sector particularly in the subscriber base of wireless services and the fusion of telecommunication, information technology and cable services of major firms.
  • Industry sources say the tight race among telecommunications firms to corner a bigger share of the mobile phone market resulted in a significant increase in cellular phone users.
  • Increase in withholding tax remittances of various taxpayers is due to the higher compliance to withholding tax laws by private sectors, other withholding agents and government agencies.

Excise tax collection from alcohol, tobacco and miscellaneous products increased  prior year’s collection by 3.70%, 5.36% and 9.96%, respectively, attributable to:

  • The effect of the 12% automatic increase in tax rates implemented last January 1, 2000 particularly on distilled spirits and fermented liquors, both in terms of removals and cash collections.
  • The effect of 12% automatic increase of specific rates in cigars and cigarettes, that despite the decrease in removals of medium and high priced brands of cigarettes, collections increased.
  • The huge demand for commercial vehicles prompting the manufacturers to introduce new automobile models/brands from companies like Ford Motor Company, Honda and Nissan Phils.  For CY 2000, automobile sales increased by 6.42% or 28,410 units this year from 26,697 units of last year.

The collection from other percentage tax is higher than last year’s collection by P 2.457 B or 11.15%.  The positive performance is due to:

  • Based on the National Statistics Coordination Board (NSCB) report, GDP on bank and non-banks at current prices grew by 3.9% and 7.6% respectively, compared to the same level last year.
  • Withholding tax collection from National Government  Agencies increased by 105.57% due to the implementation of Joint  Circular No. 1 – 2000 re: Tax Remittance Advice System.

On the other hand, the negative performance of other tax types may be explained, as follows:

Taxes withheld from bank deposits and capital gains tax were 6.99% and 6.41%  below the 1999 collection.  The negative growth was evident in the:

  • Lower turnover of capital gains tax returns filed for the period by 8.20% (10,932 returns) compared to last year’s turnover.
  • Depositors’ availment of  the “Double Your Money in 5 Years” promotions of the banks, in which the interest is exempt from final withholding tax.

Decreases in collection of petroleum products by 5.62% compared to previous year’s collection were strongly linked to:

  • The shift from leaded gasoline to unleaded gasoline in Metro Manila that meant a decrease of P 1.00 per liter in taxes collected.
  • The decrease in sales of the three major oil companies was affected by increase in importations of the new players in the market subject to custom duties.
  • Excise tax on imported finished petroleum products previously paid to the BIR is now being collected by the Bureau of Customs.

Collections from Value Added Taxes and Other Taxes registered decreases of 3.52% and  4.19%, respectively  over last year’s collectionwhich were caused by:

  • Economic slowdown and peso devaluation.  As reported by NSCB, the gross value added of construction  at current prices deteriorated from  3.5% in 1999 to 0.4% in 2000.  Specifically due to the zero growth of public construction.  Likewise, the slump in real estate is noted.
  • The hostage crisis and the problem of a resurgent Moro separatist insurgency in Mindanao.
  • The decrease in the transfer tax collection due to low turnover of tax returns filed from  39,514 filers last year to 38,764 filers this year.

 

  • Total Collection for CY 2000 by Implementing Group amounted to P 360.80 Billion which is P 19.64 Billion or 5.76 % more than that of CY 1999. Collection from Regional Offices registered the highest increase compared to 1999 by 9.38%, followed by Excise Taxpayers Service at 2.97% and Large Taxpayers Service at 2.75%.
  • Implementing Offices in the National Office namely Large Taxpayers Service (LTS) and Excise Taxpayers Service (ETS) generated P 196.94 Billion representing 54.58 % of the total collection by implementing group. Of the collection from National Office, LTS contributed 32.82% while ETS share was 21.77%.
  • RR No. 8 - Makati delivered 11.59 % followed closely by RR No. 6 - Manila with 11.54 %.

COLLECTION BY IMPLEMENTING GROUP

  • The combined efforts of the LTS, ETS in the National Office, and Regional Offices in Manila and Makati raised 77.71% of the Total Collection by Implementing Group.
  • Compared to previous year's collection, seventeen (17) out of twenty (20) Implementing Offices increased their collection in CY 2000.
  • Growth in collections of revenue regions ranged from 5.18 % to 56.68 %.
  • RR No. 14 - Tacloban City registered the largest percent of excess at 30.43 % over the assigned collection goal.

COLLECTION BY MANNER OF PAYMENT

  • Cash collections from voluntary payment amounted to P 358.87 Billion in CY 2000 representing 99.46% of the total BIR collections.
  • This year's collection from voluntary payment showed an P 19.33 Billion or 5.69% increase from that of CY 1999 collection of P 339.53 Billion.
  • This improvement may be attributed to the year-round dialogue with taxpayers, continuing tri-media information/education campaigns, and simplified monitoring of withholding tax payments through Tax Remittance Advice (TRA) from the National Government Agencies (NGAs) as prescribed in Revenue Memorandum Order No. 16-2000.
  • Collections generated from preliminary/final assessments and delinquent accounts amounted to P 1.81 Billion and P 0.12 Billion, contributing 0.50% and 0.03%, respectively, to the total collections.