Gov't favors VAT hike

IMF reportedly wants the government to raise the VAT rate to 15%, so VAT collection can go up by an estimated P10 billion. A study by the National Tax Research Center showed the government lost as much as P307 billion in taxes from 1993 to 2002 because of excessive claims of input VAT credits, VAT c...

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Bibliographic Details
Published in:Business world (San Juan, Philippines) Philippines), 2004-07, p.1
Main Author: Karen L. Lema and Jennifer A. Ng
Format: Article
Language:English
Subjects:
Tax rates
Taxes
Text messaging
VAT
Online Access:Get full text
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Summary:IMF reportedly wants the government to raise the VAT rate to 15%, so VAT collection can go up by an estimated P10 billion. A study by the National Tax Research Center showed the government lost as much as P307 billion in taxes from 1993 to 2002 because of excessive claims of input VAT credits, VAT claims by ineligible firms, and lack of industry standards to validate claims of input VAT. Under the VAT system, tax liability is computed using the tax credit or "invoice" method. Firms are entitled to subtract, from the VAT on their sales or output, the VAT on all their purchases, including that on capital goods.
ISSN:0116-3930