BIR warns artists to settle their tax arrears

The Bureau of Internal Revenue (BIR) has warned entertainment personalities to settle their tax arrears before they are swept by the bureau’s ongoing audit.

The BIR said professionals in general would be allowed to voluntarily settle their tax arrears, warning that if they are caught first, there would be no negotiating their sanctions.

"We are launching an information campaign to inform voluntary taxpayers how to deal with their tax obligations," said BIR Commissioner Guillermo Parayno.

"Actors and entertainers, in particular, are always telling us that they leave it up to their managers to deal with their taxes," Parayno said.

During their information drive, Parayno said the BIR always reminds voluntary taxpayers to settle their accounts and head off the BIR audit.

"Once we start the audit and they are investigated, that’s already the point of no return," Parayno said. "We would have to prosecute them with the full force of the law."

The BIR has repeatedly warned professionals and other voluntary taxpayers that the government has suspended all negotiations and compromise processes for delinquent taxpayers.

"We will no longer entertain negotiations once we audit a person or entity," Parayno said.

"In the past, the BIR had been satisfied just having the tax arrears settled." Parayno pointed out. "Now, not only will we make them pay, they will also have to face the full consequences of their tax evasion."

The BIR said it has tapped professional organizations and associations for its ongoing audit of professional practitioners including doctors, lawyers, accountants and entertainers.

According to Parayno, even industry associations are being tapped to compel their member companies to ensure that they are dealing with taxpaying suppliers and business partners.

The BIR said various professional associations have comprehensive listings of professional individuals that could help revenue auditors in the verification of income and other tax payments.

Parayno said the BIR’s campaign against professionals who have been delinquent in their tax payments have so far yielded results. "The turnout this year is the highest ever for voluntary income tax filers," he said.

At the April 15 deadline for the filing of income tax returns, Parayno said collection surged by 43.4 percent, reaching P21.34 billion compared to P14.882 billion collected on the same day the previous year.

"The increase indicates larger taxpayer turnout and greater voluntary compliance," Parayno said.

Parayno said peer pressure could be a significant force if employed for the purpose of ensuring that legitimate individuals and businesses only deal with partners or other businesses that pay their taxes.