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

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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

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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

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Philippines at a a glance

OVERVIEW

• f the use of INFORMATION TECHNOLOGY

(IT) in Tax Administration

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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

The Bureau of Internal Revenue

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The Bureau of Internal Revenue

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COMMISSIONER

DEPUTY COMMISSIONER OPERATIONS GROUP Customer Support Service Collection Service Assessment Service Regional Offices DEPUTY COMMISSIONER LEGAL GROUP Legal Service Internal Affairs Service Enforcement & Advocacy Service

DEPUTY COMMISSIONER INFORMATION SYSTEMS GROUP

Info Systems Devt & Operations Service Info Systems Project Management Service Revenue Data Centers

DEPUTY COMMISSIONER RESOURCE MANAGEMENT GROUP

Human Resource Service Finance Service Administrative Service Planning & Management Service Large Taxpayers Service Project Management and Implementation Service

BACKGROUND

1994 - Tax Computerization Project was undertaken 1996 - Integrated Tax System (ITS) was implemented 1998 - BIR website was launched

Use of IT in Tax Administration

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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

Use of IT in Tax Administration

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Recent Di Digital al De Develop

• pments

Impact of Social Media Recent eFiling Development Recent ePayment Campaign and Channels

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Recent Digital Developments -

Socia

• cial M

l Med edia ia C Campaig igns

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STATISTICS OF ELECTRONICALLY FILED TAX RETURNS PER SYSTEM (eFPS & eBIRFORMS)

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 2015 3,287,087 6,563,925 9,851,012 2016 4,304,254 13,243,832 17,548,086 2017 4,847,263 15,032,711 19,879,974

eFPS eBI RForms TOTAL YEAR

Recent Digital Developments

Note:

Source : ITS (Manual Filers). Based on Filing Date Run Date: Jan. 9, 2018 (Manual Filed Returns for Jan. to Dec. 2017)

PERCENTAGE OF eFILING OVER TOTAL FILING

YEAR

• NO. OF eFILED

RETURNS (eFPS & eBIRFORMS) TOTAL FILED RETURNS % OF eFILED OVER TOTAL FILED RETURNS 2015 9,851,012 23,020,857 43% 2016 17,548,086 28,862,395 61% 2017 19,879,974 28,764,869 69%

Recent Digital Developments

No of Transactions increase of 2344% in 2016 compared to 2015 and 779% increase in 2017 compared to 2016 Amount of collection increased by 2444% in 2016 compared to 2015 and 862% increase in 2017 compared to 2016

Recent Digital Developments

Month/ Year

• No. of

Transactions Amount

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 $ 256,983.66 146 3,568 31,373

50,000

2015 2016 2017

Number of Transactions 212,495 5,406,067.29 52,020,740.90 100,000,000 2015 2016 2017

Amount of Collection Note: Converted to US Dollar (PhP 52.00 to $1)

146 1,954 6,453

13,285

10,000 20,000

Oct-17 Nov-17 Dec-17 Jan-18

Number of Transactions 212,495 3,170,069 5,872,429 13,109,245.29 20,000,000

Oct-17 Nov-17 Dec-17 Jan-18

Amount of Collection

CREDI T/ DEBI T/ ATM CARD ONLI NE TAX PAYMENT

Recent Digital Developments

Total Transactions Amount

2017 6,453 P hP 9,254,993.10 $ 177,980.64 2018 January 13,285 P hP 13,109,245.29

$

252,100.87

Month/ Year Credit/ Debit/ ATM Card

Note: Converted to US Dollar (PhP 52.00 to $1)

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PERCENTAGE OF ePAYMENT OVER TOTAL PAYMENT TRANSACTIONS

YEAR

• NO. OF

ePAYMENT TRANS ACTIONS (in million) TOTAL PAYMENT TRANS ACTIONS (in million) % OF ePAYMENT OVER TOTAL PAYMENT TRANS ACTIONS 2015 2.098 13.797 15% 2016 2.818 15.558 18% 2017 3.569 16.729 21%

Note: Run Date: Jan. 4, 2018 (Years 2015 and 2016)

• Feb. 22, 2018 (Year 2017)

Recent Digital Developments

Electr ectronic T Tax I Infor

• rmati

tion S System em ( (eTIS) Op Optimizati tion

• n a

and E Enhancem cemen ents

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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

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 Personal Income Tax Simplify Value Added Tax Simplify Estate and Donor’s Tax Increase Excise Tax of Petroleum Products Increase Excise Tax of Automobiles Introduce an Excise Tax for Sugar Sweetened Beverages

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Use of IT in Tax Administration

“ in every CHALLENGE lives a greater OPPORTUNITY”

• Jeffrey Benjamin

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Challenges and Opportunities CH CHALLE LLENGES S AND I ISSU SUES

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• Internet Speed and Cost
• Procurement
• People
• Upgrading And Integration of Systems
• Policy
• eBusiness
• Security
• Enterprise Risk, and
• Others

Impact of eTIS Optimization

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Challenges Opportunities Project team need to be reorganized Chance to involve more people in the

• rganization

Optimization requires re- architecting the code allow incorporation of TRAIN impact to the new Core Tax Admin System Chance to conform with e-government Cloud- first policy Chance to incorporate new data privacy and

• ther security requirements

Chance to conform with new DOF data dictionary and other standards

Challenges and Opportunities

Impact of TRAIN

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

Challenges and Opportunities

TRAIN: eInvoicing/e-Receipting and eSales Reporting

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The Difference

• Transaction is recorded in their Receipting Device, standard price

generated by the system and receipt is printed

• Paper used to print receipts has a government seal on it
• Possible incentive fiscal rewarding system

Support / Call Center Data Center Analytical Platform Customer Service Maintenance Centers Real-Time dashboards for high Government Officials Recording and transmitting sales data via GPRS/USSD 1 2 3 VAT receipts Generate:

• reports for

VAT refund

• third-party

matching in case of tax audits/ assessments

Challenges and Opportunities

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Conclusi sion

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Never before in history has innovation

• ffered promise of so much to so

many in so short a time.

• Bill Gates

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