The paper compares and analyzes the tax performance of the revenue regions (RRs) and the revenue district offices (RDOs) under their jurisdiction, and identifies the top collectors and the poor performers from 2000 to 2009. The BIR is the country’s premier tax-collecting agency contributing over 75.0% of total NG tax revenues. Its overall performance depends on the aggregate collection of its implementing offices, namely the National Office and the 19 RRs situated in different places in the country. Operating under these implementing offices are 119 RDOs that provide frontline taxpayer assistance and services. From 2000 — 2009, on the average, about 55.0% of the total internal revenue tax was contributed by the four RDOs under the Large Taxpayers Service (LTS) in the National Office, while the remaining 45.0% was contributed by the RRs, which shall be the focus of this paper.
Three RRs in Metro Manila namely, RR8-Makati City, RR7-Quezon City and RR6-Manila contributed, on the average, nearly two-thirds of the aggregate collection of the RRs from 2000 — 2009, mainly because major economic activities are concentrated in the metropolis. The next two highest contributors were RR9-San Pablo City, which covers Region IV-A (CALABARZON) including certain provinces in Region IV-B (MAMIROPA); and RR5-Caloocan City, which includes the CAMANAVA area and the province of Bulacan. On the other hand, RR17-Butuan City consistently contributed the least tax collection to the NG coffers, followed by RR15-Zamboanga City, RR3-Tuguegarao, Cagayan and RR18-Koronadal City.
The RRs located in highly developed and populated regions such as Metro Manila, Metro Cebu and neighbouring regions have the highest taxable base represented by gross regional domestic product (GRDP). On the other hand, the RRs with limited taxable base are found in the ARMM regions, Caraga, CAR, Cagayan Valley and Eastern Visayas. These regions are also among the least populated and with the least number of business establishments. In terms of tax effort, which is calculated by dividing the collection of the revenue regions by the region’s GRDP, the NCR RRs namely RR5-Caloocan, RR6-Manila, RR7-Quezon City and RR8-Makati posted the highest combined tax effort of 8.21%; followed by RR-9 San Pablo City, 3.37%; RR1-Calasiao, Pangasinan, 2.48%; RR4-San Fernando, Pampanga, 2.44%; and RR14-Tacloban City, 2.25%. On the other hand, RR15-Zamboanga City, RR18-Koronadal City and RR16-Cagayan de Oro City had the lowest tax effort of 1.31%, 1.36% and 1.52%, respectively.
Meanwhile, comparative analysis of the collection vis-Ã -vis goal of the RRs show that no single RR was able to continuously meet its target annually from 2000 — 2009. The RRs experienced shortfall in collection in at least four years within the 10-year period. In particular, RR6-Manila, RR13-Cebu City, RR14-Tacloban City and RR17-Butuan City failed to meet their target in four years while RR4-San Fernando, Pampanga missed its target in eight years. All others collected below their respective targets in as many as five to seven times in 10 years.
Based on the most important findings of the study, the following were recommended:
1. There may be a need to align the Revenue Regions (RRs) of the BIR with the administrative regional classification of the government for purposes of uniformity and consistency;
2. The revenue region’s tax effort may be used as one of the indicators in assessing regional tax performance. There is a need to closely monitor the RRs with high taxable bases as represented by high GRDP and large number of business establishments but were found to have a very low tax effort to improve tax collection and compliance;
3. There is a need to focus on the discrepancies between number of tax returns filed and amount of tax payments made. This review should be able to uncover the reason/s for the discrepancies and the formulation of the corresponding response/action thereon by the concerned RRs/RDOs;
4. Regional conferences/dialogues/fora should be conducted on a regular basis to serve as a means for exchanging tax administration experiences and best practices; and
5. The number of technical personnel be commensurate with the number of tax returns being processed in the RR. Thus, a realignment of technical personnel from RRs with fewer tax filers to RRs with more tax filers should be pursued. Moreover, the importance of adequate administrative support to technical personnel in processing tax returns is emphasized.
