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Angara files bill to ease burden of Filipinos in paying taxes

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MANILA—Aside from income tax reform, Senator Juan Edgardo ‘Sonny’ Angara will be prioritizing the passage of bills that will promote taxpayer’s rights, and create an office that will help address the difficulties faced by Filipinos in paying taxes.

“In my first three years as chairman of the Senate Ways and Means Committee, we’ve received a lot of complaints on how difficult and cumbersome it is to register, file and pay taxes in our country. The government should first seek to help our taxpayers comply with our regulations rather than penalize them in the first instance,” Angara said.

To help taxpayers, especially the self-employed and professionals, Angara has filed a bill that seeks to establish a Taxpayer Assistance Service within the Bureau of Internal Revenue (BIR), composed of knowledgeable, competent and professional employees, to answer queries and guide taxpayers on how to efficiently and effectively deal with their tax-related problems and concerns.

The Taxpayer Assistance Service bill is among Angara’s top priority measures, which also include bills that would lower individual income tax rates, and update and index the tax brackets to inflation.

The senator noted that despite the past administration’s great strides on tax collection, averaging 10-percent year-on-year growth, the BIR has failed to meet its target in the last decade.

He added that tax compliance and collections would further improve if the government can lessen the complexity and intricacy of the country’s tax code.

“As a developing country with many uneducated people who are not aware of our tax laws because they are quite complex and old, the Department of Finance (DOF) should take a developmental approach to the collection of taxes and duties since all previous efforts to broaden tax base have basically failed,” Angara said.

According to a recent data on personal income tax compliance rates, only 41 percent of professionals and 30 percent of self-employed pay their taxes, as compared to the 99-percent compliance rate of salaried workers since their taxes are automatically withheld from their paycheck.

A study by Dr. Stella Quimbo of the University of the Philippines School of Economics showed that the low compliance rates of professionals and self-employed resulted in a PHP66-billion foregone revenue, and if such compliance will go up to at least 75 percent, personal income tax collection will increase by PHP40 billion.

Angara stressed that the projected increase in tax collection brought about by higher compliance among self-employed and professionals can easily compensate for the estimated revenue loss if the bill on indexation of income tax rates will be passed.

“A former BIR Commissioner once said that Filipinos, by nature, are good people, and that contrary to public perception, Filipino taxpayers really want to comply and pay their taxes. They want to help in rebuilding the country through their taxes,” he said.

“So, instead of making it extra hard for our taxpayers, we should provide them with free and accessible professional assistance. The Taxpayer Assistance Service would render the first layer of professional tax services that every Filipino taxpayer needs and deserves,” the lawmaker added.

Under the proposed measure, the Taxpayer Assistance Service, which will be established under the Office of the BIR Commissioner, shall prepare listings and standard answers to frequently asked questions of taxpayers, particularly on registration, payments and filing of returns.

It is also mandated to prepare, publicize and circulate policies, programs, standards, guidelines and procedures relative to public information and education programs on taxation.

Angara has also filed a bill that will put in place a charter on taxpayer’s rights, and create a National Taxpayer Advocate Office that will promote their rights and protect them against harassment and corrupt practices of some officers and employees of the BIR and the Bureau of Customs (BOC).

“There is a need to safeguard the rights of taxpayers who are entrusting a significant share of their hard-earned money to the hands of the government. In return, it is our hope that all taxpayers will be more truthful and timely in the filing and payment of tax dues,” he said.

 

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