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IMF doubts revenue projection from tax amnesty |
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(December 17, 2003 - Wednesday, Philippine Daily Inquirer)
by Clarissa S. Batino THE INTERNATIONAL Monetary Fund is doubtful that the government can raise the estimated 9.4 billion pesos in additional revenue from a proposed tax amnesty law that Malacañang wantesCongress to pass before the elections in May. |
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The IMF expressed its doubt at a meeting with Internal Revenue Commissioner Guillermo Parayno Jr.
Other sources said the IMF was worried that the government was focusing too much on getting the tax amnesty law passed at the expense of more important revenue measures such as the indexation of beer and tobacco taxes to inflation, rationalization of the documentary stamp tax, and imposition of gross receipt tax on banks. The "six taxes" indexation is projected to give the government a one-time windfall of 14 billion pesos, and the rationalization of the documentary stamps tax is projected to yield another five billion pesos annually. Parayno said of the meeting with the IMF: "We told them that there is a chance we will not be able to collect as much from the amnesty. Historically, the tax take from an amnesty program is not substantial. What is important is the data that we will get from the tax amnesty program, which we can use to widen our tax base." The 10 amnesty laws during the Ferdinand Marcos administration yielded only 1.5 billion pesos in additional collection and the three amnesty programs during the Corazon Aquino administration generated only 1.37 billion pesos. According to the estimates by the Department of Finance and the National Economic and Development Authority, the government could earn an additional 2.14 billion pesos from individual taxpayers and 7.26 billion pesos from corporate taxpayers at an amnesty rate of three percent. The government expects that only households in the income class of three million pesos or more a year that understate their assets by 40 percent would avail themselves of the amnesty. It expects five percent of large corporations and 10 percent of small and medium-scale enterprises will also take advantage of the chance to clear their past due accounts without penalties. Pending before Congress is a bill proposing tax amnesty on all unpaid tax dues up to year 2001. The bill's foremost objective, says the government, is to require all taxpayers to submit their statement of assets, liabilities, and net worth up to 2001. Adopting the position of the finance department, Malacañang has proposed to Congress implementation of a tax amnesty rate of 10 percent based on increases in net worth for those amending their tax declarations and three percent based on total net worth for those without any previous financial statement with the Bureau of Internal Revenue. home | latest news |
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