193 hours to file taxes; easier system needed

MANILA, Philippines - Sen. Juan Edgardo Angara has renewed the call to simplify the current tax system to ease the hassle of paying taxes following complaints by taxpayers who crammed to beat the deadline for filing income tax returns (ITR) last April 15.

He cited a report by the World Bank and PricewaterhouseCoopers called "Paying Taxes 2015," which showed that it takes an average of 193 hours or eight days for Filipinos to comply with their tax obligations.

This is faster than the Asia-Pacific average of 229 hours, but still slower than the 173 hours in Cambodia, 155 hours in Myanmar, 133 hours in Malaysia, 93 hours in Brunei Darussalam and only 82 hours in Singapore.

Angara lauded the efforts of the Bureau of Internal Revenue (BIR) to make taxation more transparent and efficient by implementing the electronic filing and payment system.

However, the senator noted the complaints by filers who found the new system more cumbersome and costly with the extra steps they have to take to file and pay their annual income tax.

The senator also noted the glitches on the BIR website and the unfamiliarity of some BIR officials expected to assist the confused taxpayers.

"We have a one-size-fits-all type of tax system. Business tycoons who own multi-billion corporations have the same requirements as sari-saristore owners and sidewalk vendors who may not be computer literate," he said.

"This should not be the case. Filipinos are ready to follow the law and pay taxes but they have to go through a long process and complicated system," he added.

Angara, chairman of the Senate ways and means committee, has filed a bill seeking to lower income tax rates.

He has long been pushing for a simplified process of tax filing and payment by minimizing the steps, requirements, forms and fees imposed by the BIR.

According to the World Bank report, Filipinos need to make 36 payments for full compliance as compared to 32 payments in Vietnam, 31 in Myanmar, 27 in Brunei, 22 in Thailand, 13 in Malaysia and five in Singapore.

Under the Anti-Red Tape Law, Angara noted that all government agencies are required to undertake time and motion studies of transactions to reduce processing time and bureaucratic red tape.

The senator said he has requested from the BIR the agency's time and motion studies to see how they can simplify and shorten the process.

Moving forward, he urged the BIR to fix and upgrade their e-filing system to ensure the feasibility of the new system, and to make the already burdensome task of paying taxes easier and more convenient, especially for small entrepreneurs.

"It has been a problem of the government to not have enough revenue. Tax collection has been wanting over the decades. What do we attribute this to? Some say it's because of inefficient administration.

"A simplified system coupled with an updated and lowered tax rates would definitely increase compliance, widen the tax base and raise revenue collection. We must continue to push for these tax reforms to balance the needs of both the government and the citizens," he said.

 

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