BUREAU OF INTERNAL REVENUE REPUBLIC OF THE PHILIPPINES DEPARTMENT OF FINANCE BUREAU OF INTERNAL REVENUE Quezon City RECORDS MGT. DIVISION January 21, 2019 REVENUE MEMORANDUM ORDER No. 9- 20/9 TO: All Revenue Officials and Employees Concerned SUBJECT: CY 2019 BIR Collection Goal Allocation, By Implementing Office L BACKGROUND The Department of Finance (DOF) has set the Bureau of Internal Revenue’s CY 2019 ‘overall collection goal at P2,330.698 Billion. This is inclusive of P79.012 Billion in additional revenues from the Tax Reform Acceleration and Inclusion (TRAIN) Act. This collection goal, which is based on the FY 2019 Budget of Expenditures and Sources of Financing (BESF), dated July 2018, is higher than the CY 2018 goal by P291.541 Billion, or 14.3%. Ml. OBJECTIVE This Order is being issued to establish the following: 1. The policies, methodology and guidelines used in the allocation of the CY 2019 Collection Goal; and, 2. The resulting distribution of the collection goal to the Large Taxpayers Service (LTS) and Revenue Regions (RRs), including the Revenue District Offices (RDOs) Ml, DEFINITION OF TERMS 1. Collections from Non-BIR Operations ~ Income Taxes (Final Withholding Tax) and Documentary Stamp Tax collection from government securities transactions 2. Collections from BIR Operations ~ revenues from Income Taxes, Value-Added Tax (VAT), Excise Taxes, Percentage Taxes, and Other Taxes generated from transactions not classified as “Non-BIR Operations” 3. Implementing Offices (10s] ~ the major BIR collecting offices: LTS, RRs and RDOs yrIV. GENERAL POLICIES AND GUIDELINES The following policies and guidelines were observed relative to the data requirements and goal allocation methodology used in the computation of the final goal for the 10s: A. Data Used 1. The CY 2018 estimated collection: . a. For LTS: CY 2018 Est. Collections us = CY 2017 LTS collections* + (CY 2017 LTS collections* X Average Growth Rate cy 20:5~cr 2017) * Net of Special Taxes, by industry b. For the Revenue Regions: CY 2018 Est. Collections ars = Refined CY 2017 Regional Collections + (Refined CY 2017 Regional Collections X Average Growth Rate cy 2015-cy 2017) 2. Data considered as refinements for CY 2018 Collections: a. Special Taxes, comprised of Taxes on Government Securities and Excise Taxes for CY 2018, per BIR Form No, 1209 reports updated as of December 14, 2018. b. Non-recurring transactions from January ~ October, 2018, where each single transaction accounts for at least ten percent (10%) of a Region’s / LTS’ total collections for a specific month, based on figures provided in BIR Form No. 1209 Reports updated as of December 14, 2018. c, Other Special Taxes: c.1. Regular Corporate Income Tax Collections from MALAMPAYA for CY 2018, submitted by the Large Taxpayers Service (LTS) as of December 14, 2018; and 2. Final Withholding Tax (FWT] remittances from the Bangko Sentral ng Pilipinas (BSP) for CY 2018 on interest due from domestic borrowings under Reverse Repurchase Agreements (RRPs), as well as other similar transactions, submitted by LTS as of December 14, 2018. BUREAU OF INTERNAL REVENUE \y Page 2 of 393. Other Considerations: a. Economic assumptions / indicators provided in the BESF FY 2019 (please refer to Table 1); b. Collection Goals, by major tax type, culled from the BESF FY 2019; c. The CY 2029 program on the volume of issuance of government securities and their corresponding taxes (FWT) from BESF, with regard to the Documentary Stamp Tax [DST] goal for Non-BIR Operations from the Bureau of the Treasury as of January 11, 2019. 4. The CY 2019 goal on Final Withholding Tax Remittance of BSP was estimated by RSD based on data provided by the LTS covering remittances from the BSP for the months of January ~ October, 2018. e. Adjusted 2018 monthly collections due to the change in the payment deadlines of the following: e.1. Quarterly Corporate Income Tax (BIR Form 17020); €.2, 2" Installment of Annual Income Tax Due and B. Goal Allocation Methodology The CY 2019 Goal for BIR Operations was allocated to all |Os. 1. Goal Allocation by 10 a. The estimated CY 2018 Collections were refined by taking into account the following: a.1, Actual 2018 collections from all Special Taxes were deducted; a.2. Netting-out the non-recurring collections; and 2.3. Adjustment of 2018 collections due to the change in the payment deadlines b. Computation of LTS CY 2019 Collection Goal: CY 2019 Collection Goal = CY 2018 Est. Collections + (CY 2018 Est. Collections X Average Growth Rate cy 2015 ~cv2037) c. Computation of RRs CY 2019 Collection Goal: ( C¥ 2019 Collection Goal = CY 2018 Est. Collections / Total CY 2018 Est. Collections * Total Goal for the Revenue Regions ‘BUREAU OF INTERNAL REVENUE Page 3 of 39