‘PH can learn from Russia’s tax system’


    The Bureau of Internal Revenue (BIR) and Russia’s Federal Tax Service (FTS) have met recently to discuss the latter’s best practices that the Philippines can apply to further improve tax administration and compliance, the Department of Finance (DOF) said yesterday.

    The DOF said on orders of Finance Secretary Carlos Dominguez, BIR officials met last January 13 via Zoom with Dmitry Volvach, FTS deputy commissioner, to also explore a possible bilateral cooperation agreement between the revenue agencies of the two countries.

    Dominguez earlier requested then-outgoing Russian ambassador Igor Khovaev in February last year for assistance in helping the BIR set up a tax data capture program for its value-added tax (VAT) collection effort that is similar to Russia’s highly efficient system.

    At that time, Khovaev said Russia had shared its VAT collection technology with other countries and would assist the BIR in its effort to improve its system.

    “We had an initial meeting with the FTS of Russia. They have good tax administration. They started their digitalization in 2016 and, after five years, they are now into capturing almost all the data of taxpayers,” Arnel Guballa, BIR deputy commissioner, said in a recent DOF executive committee meeting.

    Guballa said the BIR learned from the FTS that it now audits only one out of 7,000 taxpayers as a result of Russia’s well-placed and efficient system that encourages people to comply with tax laws.

    Meanwhile, last January 15, the BIR launched its Internal Revenue Integrated System (IRIS), which will serve as the agency’s central tool and repository to process taxpayers’ information.

    It is expected to be rolled out nationwide in the fourth quarter of 2021, Guballa said.

    Guballa added the IRIS launching forms part of the deliverables this year under the BIR’s long-term Digital Transformation Program.