By LEE C. CHIPONGIAN
The Department of Finance expects to collect P94.34 billion in non-tax revenues in 2006 or 1.6 percent of gross domestic product, higher than the adjusted target of P91.86 billion this year.
The latest forecast was finalized this month. These administrative or non-tax measures are back-up collections to help ease shortfalls in the Bureau of Internal Revenue and the Bureau of Customs.
As of August, non-tax revenues have reached almost
P78.3 billion. From September to December, the emerging number is P23.1 billion, which means collections will surpass target by P10 billion to P101.4 billion by the end of the year. The original target for 2005 was only P77 billion.
"The expected underperformance for BIR and BOC will be offset by the favorable performance of the non-tax collections," the DoF said. Alternative measures includes increasing the non-tax revenues if the taxes – for example excise taxes — fail to materialize as programmed by the National Government.
At the moment DoF Secretary Margarito B. Teves is exploring more alternative measures or non-tax measures to raise funds. These non-tax revenues are fees and charges from dealings with the government or money extracted from anyone with transactions with the state, and income from the Bureau of Treasury.
Teves said at the moment, the government is more concerned on the smooth implementation of the reformed value added tax law.
Under the reformed VAT law or Republic Acct 9773 the ten percent-12 percent tax will now be slapped on petroleum products and their raw materials, coal, natural gas and other indigenous materials and also VAT on power and electric cooperatives.
The latest DoF numbers show that the projected additional revenue from the VAT at 70 percent collection efficiency is
P81.41 billion for 2006. This is net of mitigating measures, which reduced VAT collection by P21.50 billion.
This is broken down as
P35.12 billion when the VAT is at 12 percent and P38.54 billion with the repeal of VAT exemptions such as on petroleum (P29.95 billion), power (P6.19 billion) and medical and legal services (P1.81 billion).
Other VAT reform measures will cough up an additional
P23.29 billion.
Also starting 2006, 30 percent of the incremental VAT collection for the year will be used for capital expenditures. This amount will be increased by five percent yearly until it reaches 50 percent in 2010.
