Tax Administration in the Digital Age: Challenges and Opportunities - PowerPoint PPT Presentation

Tax Administration in the Digital Age: Challenges and Opportunities By Attorney Lanee Cui-David Deputy Commissioner, Information Systems Group Bureau of Internal Revenue The Philippines 1

Outline of Presentation I. Philippines at a glance II. Overview of the use of information technology (IT) in tax administration, background, recent digital developments III. Challenges, opportunities and strategy IV. Conclusion 2

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Philippines at a a glance Location: South East Asia Archipelago: 7,107 islands Land mass: 300,000 square kilometers Capital: Manila Population: 106.51 million latest UN estimates Climate: Tropical Languages: Filipino, English Literacy: 92.6% Monetary Unit: Philippine Peso 4

Philippines at a a glance 5

OVERVIEW of the use of INFORMATION TECHNOLOGY (IT) in Tax Administration 6

The Bureau of Internal Revenue Mission Collect taxes through just enforcement of tax laws for nation-building and the upliftment of the lives of Filipinos Vision An institution of service excellence and integrity 7

The Bureau of Internal Revenue COMMISSIONER Large Taxpayers Service Planning & Management Service Project Management and Implementation Service DEPUTY COMMISSIONER DEPUTY COMMISSIONER DEPUTY COMMISSIONER DEPUTY COMMISSIONER OPERATIONS GROUP LEGAL GROUP INFORMATION SYSTEMS GROUP RESOURCE MANAGEMENT GROUP Customer Support Info Systems Devt & Human Resource Legal Service Service Operations Service Service Info Systems Project Collection Service Internal Affairs Service Finance Service Management Service Enforcement & Advocacy Assessment Service Revenue Data Centers Administrative Service Service Regional Offices 8

Use of IT in Tax Administration BACKGROUND 1994 - Tax Computerization Project was undertaken 1996 - Integrated Tax System (ITS) was implemented 1998 - BIR website was launched 9

Use of IT in Tax Administration BACKGROUND 2001 - Electronic Filing and Payment System was developed and introduced 2002 - BIR expanded its eServices and developed to 2008 new systems 2013 – eBIR Forms System was developed and used 10

Recent Di Digital al De Develop opments Impact of Social Media Recent eFiling Development Recent ePayment Campaign and Channels 11

Recent Digital Developments - Socia ocial M l Med edia ia C Campaig igns 12

Recent Digital Developments STATISTICS OF ELECTRONICALLY FILED TAX RETURNS PER SYSTEM (eFPS & eBIRFORMS) YEAR eFPS eBI RForms TOTAL 2002 29,097 NA 29,097 2012 1,270,452 NA 1,270,452 2013 1,505,311 NA 1,505,311 2014 1,952,293 2,510 1,954,803 9,851,012 2015 3,287,087 6,563,925 17,548,086 2016 4,304,254 13,243,832 19,879,974 2017 4,847,263 15,032,711

Recent Digital Developments PERCENTAGE OF eFILING OVER TOTAL FILING NO. OF eFILED % OF eFILED OVER TOTAL FILED YEAR RETURNS TOTAL FILED RETURNS (eFPS & eBIRFORMS) RETURNS 9,851,012 23,020,857 43% 2015 61% 2016 17,548,086 28,862,395 69% 2017 19,879,974 28,764,869 Note: Source : ITS (Manual Filers). Based on Filing Date Run Date: Jan. 9, 2018 (Manual Filed Returns for Jan. to Dec. 2017)

Recent Digital Developments Number of Transactions 50,000 31,373 3,568 146 0 2015 2016 2017 No of Transactions increase of 2344% in 2016 compared to 2015 and 779% increase in 2017 compared to 2016 Amount of Collection 100,000,000 52,020,740.90 5,406,067.29 212,495 0 2015 2016 2017 Amount of collection increased by 2444 % in 2016 compared to 2015 and 862% increase in 2017 compared to 2016 No. of Month/ Year Amount Transactions 2016 3,568 PhP 5,406,067.29 $ 103,962.83 2017 31,373 PhP 52,020,740.90 $ 1,000,398.86 2018 January 11,482 PhP 13,363,150.14 $ 256,983.66 Note: Converted to US Dollar (PhP 52.00 to $1)

Recent Digital Developments CREDI T/ DEBI T/ ATM CARD ONLI NE TAX PAYMENT Number of Transactions 20,000 13,285 10,000 1,954 6,453 146 0 Oct-17 Nov-17 Dec-17 Jan-18 Amount of Collection 20,000,000 13,109,245.29 5,872,429 3,170,069 212,495 0 Oct-17 Nov-17 Dec-17 Jan-18 Credit/ Debit/ ATM Card Month/ Year Total Amount Transactions 6,453 P hP 9,254,993.10 2017 $ 177,980.64 2018 13,285 P hP 13,109,245.29 January $ 252,100.87 Note: Converted to US Dollar (PhP 52.00 to $1)

Recent Digital Developments PERCENTAGE OF ePAYMENT OVER TOTAL PAYMENT TRANSACTIONS NO. OF % OF ePAYMENT TOTAL PAYMENT ePAYMENT OVER TOTAL YEAR TRANS ACTIONS TRANS ACTIONS PAYMENT (in million) (in million) TRANS ACTIONS 15% 2.098 13.797 2015 2.818 15.558 18% 2016 3.569 16.729 21% 2017 Note: Run Date: Jan. 4, 2018 (Years 2015 and 2016) Feb. 22, 2018 (Year 2017) 17

Use of IT in Tax Administration Electr ectronic T Tax I Infor ormati tion S System em ( (eTIS) Op Optimizati tion on a and E Enhancem cemen ents  a web-based workflow-driven system developed to replace the 22-year old Integrated Tax System (ITS)  Performance and other implementation issues will be resolved  Incorporate enhancements that when implemented will allow shutdown of eTIS  Integrate with eServices 18

Use of IT in Tax Administration Tax Reform for Acceleration and Inclusion (TRAIN) The goal of the first package of the Comprehensive Tax Reform Program (CTRP) or TRAIN is to create a simpler, fair , and more efficient system Lower Simplify Simplify Personal Income Tax Value Added Tax Estate and Donor’s Tax Increase Increase Introduce an Excise Tax of Petroleum Excise Tax of Automobiles Excise Tax for Sugar Products Sweetened Beverages 19

“ in every CHALLENGE lives a greater OPPORTUNITY” - Jeffrey Benjamin 20

Challenges and Opportunities CHALLE CH LLENGES S AND I ISSU SUES • Internet Speed and Cost • Procurement • People • Upgrading And Integration of Systems • Policy • eBusiness • Security • Enterprise Risk, and • Others 21

Challenges and Opportunities Impact of eTIS Optimization Challenges Opportunities Project team need to be Chance to involve more people in the reorganized organization Optimization requires re- allow incorporation of TRAIN impact to the architecting the code new Core Tax Admin System Chance to conform with e-government Cloud- first policy Chance to incorporate new data privacy and other security requirements Chance to conform with new DOF data dictionary and other standards 4/1/2018 22

Challenges and Opportunities Impact of TRAIN Challenges Opportunities Lowering PIT, simplification of Incentivise taxpayers with simpler forms and VAT and Estate/Donor’s Tax, procedure and quicker cash refunds New Excise Tax and increase in Chance to build a transparent, easier to use, existing ones affect processes, secured, integrated systems using updated forms, codes tables used by technology eServices and Core Tax Admin eTIS Optimization will allow incorporation of Systems. TRAIN impact to the new Core Tax Admin System eInvoicing, eReceipting, Reduce TP dependence on paper receipt; eReporting Massive and Costly Enhance capture of digitized detailed data; Info & Communications Enhance agency data insights & intelligence Technology requirement 4/1/2018 Increased effectiveness in tax administration 23

Challenges and Opportunities TRAIN: eInvoicing/e-Receipting and eSales Reporting Support / 1 Call Center Real-Time Data dashboards Center for high Government Officials Analytical 3 Platform Recording and Generate: 2 transmitting sales • reports for VAT data via GPRS/USSD VAT refund Customer receipts • third-party Service matching in The Difference case of tax • Transaction is recorded in their Receipting Device, standard price audits/ generated by the system and receipt is printed Maintenance assessments • Paper used to print receipts has a government seal on it Centers • Possible incentive fiscal rewarding system 24

4/1/2018 25

Conclusi sion on 26

Never before in history has innovation offered promise of so much to so many in so short a time. - Bill Gates 27

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