Bill making it easier to pay taxes gets final House nod

MANILA – The government will soon be making it easier to pay taxes as a measure seeking to modernize tax administration and improve tax compliance hurdled final reading at the House of Representatives.

During Wednesday’s plenary session, a total of 193 lawmakers voted in favor of House Bill 8942, or the proposed Ease of Paying Taxes Act, which seeks to introduce administrative tax reforms by amending several sections in the National Internal Revenue Code (NIRC) of 1997.

No lawmaker voted against the bill or abstained from voting.

The bill aims to simplify tax compliance procedures by segmenting taxpayers and better tailoring processes, enhance the portability of tax transactions and legislate the Taxpayer’s Bill of Rights.

It proposes the creation of a Taxpayer’s Advocate Office in the Bureau of Internal Revenue (BIR) to act as the taxpayer’s recourse for issues with the Bureau.

Key benefits of the proposal include allowing taxpayers to file for a Tax Identification Number (TIN) offsite, the removal of the required annual BIR registration, and harmonization of venue rules to allow fully online filings with the Bureau.

Albay Rep. Joey Salceda said the measure would help consolidate the country’s fiscal situation and improve our recovery trajectory after the coronavirus disease 2019 (Covid-19).

“When you are paying down Covid-19 debts, you want your taxpayers to be as compliant as possible. If you make it easier for them to do that, then they will probably be more willing to pay the right taxes. Tax complexity creates tax arbitrage and even administrative corruption. If you make it easier to pay taxes, you make life harder for tax cheats and fixers,” Salceda said.

Other key features of the bill are introducing a “medium” taxpayer classification and streamlined procedures for the “small” taxpayer; canceling the BIR registration requirement, which will also cancel automatic BIR audits; removing the need to secure authority to print from the BIR before hard copy invoices can be issued; and ensuring taxpayer’s rights as the guiding principle in formulating and implementing tax policies and regulations.