MANILA, Philippines - The Bureau of Internal Revenue (BIR) is expecting the effects of typhoons "Ondoy" and "Pepeng" (international code names Ketsana and Parma, respectively) to cost the agency at least P6.3 billion in income tax collections.

The amount represents potential income tax collections from individual and corporate income taxpayers whose businesses were affected by the 2 typhoons, which hit the country in late September and early October, respectively.

The BIR has allowed storm-hit businesses to file for income tax deductions. As of December 10, BIR acting commissioner Joel Tan-Torres said firms have reported to the agency a total of P21 billion in storm damages.

At P21 billion, Tan-Torres said the BIR's mandatory 30% income tax is P6.3 billion.
"This was not anticipated," he told reporters.

Tan-Torres said the impact of this would be felt in next year's collections as the affected taxpayers would avail of the tax deduction in April next year, the same time when they file their income tax returns.

The BIR has set a collection target of P875.1 billion next year, but Tan-Torres said the agency may only collect P830 billion due to various revenue-eroding measures approved by Congress as well as the current global economic conditions.