The Philippines will implement and Modernized Automated Digital Tax Revenue System

Reported in the Asia Pacific Future Gov, the PHILIPPINES TO MODERNISE REVENUE ADMINISTRATION article published Monday 14^th January 2013.

The Bureau of Internal Revenue is embarking on a US$54.3 million Revenue Administration Reform Project (RARP) which aims to increase tax revenues over time and address issues posed by corruption, tax administration inefficiencies and lack of transparency, by introducing state of the art technologies to enhance the country's overall tax administration system.

The project is funded by the Millennium Challenge Account – Philippines (MCA-P), an office of the independent US foreign aid agency created to help developing nations in their fight against poverty by way of implementing strategic threshold programs.

RARP is composed of the following sub-projects: Electronic Tax Information Systems (ETIS), Automated Auditing Tools (AATs), a Public Awareness Campaign, and an anti-graft investigation unit for the Department of Finance.

The ETIS aims to modernize BIR and provide an enhanced tax administration system that can be fully used by the agency nationwide.

According to MCA-P, this effort will improve the trustworthiness of actions and decisions based on tax data. These, in turn, will improve tax compliance monitoring, reduce client contact and opportunities for negotiated assessments, increase the detection of misreporting and enhance the value of reports. Improved compliance, audit and enforcement tools will contribute to a sustainable program of tax administration leading to increased tax revenue collection.

The bidding process for the implementation of the ETIS is currently underway after the MCA-P formally invited firms to submit their bid documents last November.

Meanwhile, AATs are computer software and hardware for the conduct of computer-assisted audits which promote proper taxpayer compliance in filing and paying taxes.

MCA-P will fund the purchase of software licenses, hardware and subscription to a database service. This initiative will make it possible for tax payers to submit tax records in digital form, thereby reducing by half the number of days it takes to complete a tax audit.

The reduction in man days per tax audit is expected to help BIR reduce its backlog of unfinished audits promote taxpayer satisfaction and ultimately leads to increased revenue collection.

Just recently, revenue officers at the BIR had undergone had a series of training courses to enhance their audit skills in a computerized accounting environment. The training was held at the newly-renovated and furnished Computer-Assisted Training Tools and Techniques (CAATTs) training facility, also part of the AATs sub-project.

This modern automated Tax Revenue system could be a step for a National ID system so every tax payer will pay their taxes automatically using ETIS system.