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New tax amnesty seen to generate $2M
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Posted on Oct 19 2005
The Department of Finance expects to collect at least $2 million from the newly enacted tax amnesty program.
Public Law14-90, which was signed into law on Sept. 30, provides for a six-month amnesty for tax delinquents.
During this period, concerned individuals or entities are allowed to settle their outstanding tax obligations with the government without penalty.
“We hope to get at least $2 million from [the tax amnesty],” said Atalig yesterday.
The department collected some $2 million under the 2004 tax amnesty law. The previous amnesty program was effective for 120 days or four months.
The new program provides for a longer amnesty period of 180 days, or up to March 2006. During this time, delinquent taxpayers can settle their taxes “without imposition of penalty and interest, with certain exemptions and for the waiver of penalty for failure to obtain a business license.”
In signing the bill into law, Gov. Juan N. Babauta said that, although he had said that he would no longer support another tax amnesty when he approved one last year, current “economic pressures facing small businesses and families” prompted him to approve it.
“…Rising fuel costs, the pullout of Japan Airlines, and other external market forces have increased the economic pressures facing small businesses and families with outstanding tax obligations. In light of this change in circumstances, I have decided to sign this measure into law,” said Babauta in his Sept. 30 transmittal letter to the Legislature.
Babauta said that 25 percent of all funds collected under the new amnesty program will be used for increased tax enforcement and collections.
The new law was authored by Rep. Clyde Norita and Vice Speaker Timothy P. Villagomez, who both said that not all delinquent taxpayers took advantage of the previously passed amnesty laws.
The Legislature also passed a tax amnesty bill during the 12th Legislature.
They said that tax amnesty is still the most cost-effective way for the government to collect tax revenue during difficult times.
