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House panel OKs bill on BIR data interconnectivity

MANILA, Jan. 4 (PNA) -- A bill seeking to establish electronic linkages between the Bureau of Internal Revenue (BIR) and the country’s businesses for improved tax collection efficiency has hurdled the committee level at the House of Representatives.

This after the House ways and means committee approved House Bill 4601, which mandates the creation of an electronic data information interconnectivity between the BIR and the sellers of goods and services utilizing cash-register machines (CRM) and/or point-of-sale (POS) machines.

The proposed electronic system will link sales and purchased data entered on CRM/POS machines of value added tax (VAT)-registered taxpayers to the BIR’s servers for simultaneous reporting of sales and purchase data.

Quirino Rep. Dakila Carlo Cua, committee chairman and author of the bill, cited the need to improve the country’s tax administration system to boost government revenue.

“Tax administration is the heart of taxation. However, given the country’s tax laws as to what and how much to be taxed, it is still the system of tax collection which is the be-all and end-all of every government’s fiscal standing,” said Cua.

Cua explained that these data linkages could help plug loopholes in the tax system with an end view of increasing VAT collections, removing burdensome compliance requirements, and promoting transparency in businesses with bulk transactions.

“If enacted into law, the measure will greatly help in the early detection of misdeclaration done by unscrupulous taxpayers, thereby reducing or removing errors in the reporting of sales and purchases,” Cua said.

“Mandating interconnection between the BIR and appropriate government agencies will provide the BIR with third party information, easier VAT refund mechanism and data collection, all of which could be used in plugging leakages and overall efficiency of tax administration,” he added.

The use of information technology in providing connectivity between the tax authority and businesses will also put the Philippine at par with other countries, he further noted.

Finance Assistant Secretary Ma. Teresa Habitan and BIR legal counsel Atty. Nina Asuncion expressed their support for the bill during the hearing.

Department of Information and Communications Technology (DICT) project manager Cesar Vinuya said the DICT is currently putting up the necessary infrastructure that would create electronic linkages among government agencies.

The DICT also intends to replicate this system as well in the business sector. (PNA)

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