Finance Secretary Carlos Dominguez III said the government would continue on filing tax evasion cases against erring taxpayers. Philstar.com/File photo
MANILA, Philippines – Unlike with suspected drug lords, the government vowed to be nice to taxpayers, dropping the possibility of a name-and-shame campaign and relying on voluntary compliance to raise more revenues.
“Those are different things. In our particular case, collecting tax is a little more complex than getting people to surrender for drugs,” Finance Secretary Carlos Dominguez III told reporters on Tuesday.
“It’s going to be aggressive, but I don’t know if it will be as aggressive as that one,” he said.
The Duterte administration has come out strong on running after suspected drug offenders even in the face of criticisms that it sometimes violates human rights.
President Rodrigo Duterte himself had named five police generals allegedly protecting drug syndicates. They all denied any wrongdoing.
For erring taxpayers however, Dominguez said the government would just continue on filing tax evasion cases and pursuing existing ones, prioritizing those it believes are “winnable.”
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There were 635 tax evasion and smuggling cases worth P103 billion left by the previous administration under its Run After Tax Evaders and Run After The Smugglers programs.
Aside from that, the past government also relied on its Tax Watch project that publicizes company and individual names found to have low tax payments related to their transactions and income.
Dominguez, for his part, said he expects more voluntary compliance with planned lower income tax rates.
“There has to be a way for government to lower tax rates while broadening the tax base… I am sure there is a way to keep the budget balanced, while growing the middle class,” he said in a speech.
At the Philippines Investment Summit on Monday, Department of Finance spokesperson Paola Alvarez reiterated plans to increase excise tax on oil and imposing levies on sweetened drinks to recoup revenue losses.
Sought for comment, Benedict Tugonon, president of industry group Tax Management Association of the Philippines, welcomed Dominguez’s remarks.
“There is confidentiality clause in the tax law that restrains the release of information on cases,” Tugonon said in a phone interview.
“Given the new administration’s thrust in boosting tax compliance, I have no doubt it will encourage the public to pay the correct taxes,” he added.
Alvarez agreed. “Most of the tax leakages are coming from (tax) evasion, smuggling and corruption. We believe we can get that with more compliance,” she said.
