Quezon City, 09 February 2010 – The Bureau of Internal Revenue unveiled Project RIP to intensify assessment and maximize collection of estate tax by increasing awareness of the public on its proper payment.
Project RIP (which stands for Rest in Peace and usually written as epitaph for the dead) is intended to let the legal heirs know that after the death of a loved one, follows the responsibility to comply with the laws of the government.
Thru this Project, the Bureau will monitor proper payment of the estate tax which the BIR for so many years has not given much attention to.
Data gathered from the National Statistics Office showed that there were 403, 191 number of deaths in 2004, 415,271 in 2005 and 389,081 in 2006. And based on BIR records only 29,198 estate tax returns were filed in 2007, 29,863 in 2008 and 26,811 in 2009.
This statistics revealed that there is a very low number of estate tax returns filed that generated only a total of estate tax collection amounting to P649.9M in 2007, P854.9M in 2008 and P876.8M in 2009.
According to BIR Commissioner Joel L. Tan-Torres, the Bureau expects to collect about P10.7B from this Project.
“From the statistics gathered, it clearly indicates that there is a large potential to increase the number of estate tax returns filed, once these tax potentials are tapped,” Commissioner Tan-Torres said.
“Once we implement this Project, we can target to increase tax return filing to 250,000 that can generate more than P10B in estate tax collection,” Tan-Torres added.
Through the issuance of Revenue Memorandum Order No.10-2010, the Bureau shall undertake courses of action to closely monitor potential estate tax cases such as establishing linkages with public and private institutions to access information about the decedent, communicate with the administrator or the decedent’s family the need to file the estate tax return and to conduct a public awareness campaign on Project RIP.
As provided for in the RMO, the Revenue District Office (RDO) shall be responsible for the pro-active monitoring of these cases by making linkages with civil registers, hospitals, memorial parks, cemeteries, funeral parlors, crematoriums, judicial clerks of courts, obituaries, life insurance companies and other financial institutions, to access and secure records of the decedents. All information gathered shall be submitted to the Audit Information Tax Exemption and Incentives Division (AITEID) for centralized data warehousing.
The RDO having jurisdiction over the decedent’s principal residence shall send Notification Letter to the decedent’s family informing them of the requirements and due dates for filing of notice of death, estate tax return and payment of estate tax.
If the decedent’s family failed to comply with their obligation in filing the said return and in paying the said tax, the RDO shall undertake the necessary action to determine the estate tax obligation of the decedent and to protect the interest of the bureau.
For tracking the obituaries in the newspaper, it shall be the responsibility of the National Investigation Division (NID), including preparation of a list of names of the decedents with complete information and determining who among in the list are the “High Potential” cases, which have substantial properties and potential for substantial estate tax payments. The list of High Potential cases shall then be forwarded to the RDO where the decedent is a resident of or is registered.
The Offices of the Deputy Commissioner for Information Systems Group and for Operations Group (OG) shall coordinate with each other to establish Data Warehouse of potential estate tax cases for access by concerned BIR offices for their use in the capital gains tax clearance issuance and monitoring.
The Office of the Deputy Commissioner for Legal and Enforcement Group shall work hand in hand also with OG to draft issuances, policies and guidelines and all legal documents needed in Project RIP.