President Rodrigo Duterte on Thursday called for a shift in tax computation, saying his proposal will curb 70 percent of corruption in the country.
Duterte said tax dues should be computed based on gross income, not on net income.
“I am challenging everybody. You want to stop corruption especially in BIR [Bureau of Internal Revenue]? We go gross. Leave the net [taxation],” Duterte said in his speech during the inauguration of Bataan government center and business hub.
“I guarantee you: If we adopt gross [taxation], there will be no examiners,” Duterte added.
Gross income tax is assessed based on income. Meanwhile, net taxes are levied on production less subsidies received and is also paid to government less transfer payments.
Net taxes are a simple version of a checkbook balance for governments as they measure the inflows and outflows of the state’s tax activities.
Duterte previously said the country should get rid of Customs examiners and brokers to veer away from corruption.