Evaluation measures for BIR, BoC to be revised
THE DEPARTMENT of Finance (DoF) will revise the Lateral Attrition Law’s implementing rules and regulations (IRR) to include nonrevenue performance as evaluation basis in rewarding or penalizing its taxmen.
Finance Undersecretary Antonette C. Tionko of the revenue operations group said that they proposed amendments to the Revenue Performance Evaluation Board that would expand the criteria on evaluating the Bureau of Internal Revenue ( BIR) and the Bureau of Customs (BoC).
“Basically we convened the [ Revenue Performance Evaluation] board, which will be implementing the Lateral Attrition Law. So basically what we did was for certain amendments to the regulations. The basis for them are just BESF ( Budget Expenditures and Sources of Financing) targets which is actually very hard to apply to the BIR and BoC, especially if you have to divide the target into districts, revenue, and all that,” Ms. Tionko told reporters on Friday in an interview at the DoF office in Manila.
Some of these nonrevenue criteria are: taxpayer compliance, satisfaction, process improvements, organizational wellness in accordance with the Development Budget Coordination Committee, as well as compliance with the Office Performance Commitment and Review and Individual Performance Commitment and Review, according to the DoF official.
“So those are things that were added, it’s not just pure collection but many other factors as well. So those amendments are already approved by the board and are being submitted to the DBCC members for approval,” she said.
“The IRR is old, and it’s actually… it is hard to apply the old IRR to the current situation of the BIR and BoC, to the extent that there is no amendment to be made in the law itself. What we are trying to do is work out what we have and by amending only the IRR first. Proposed amendments can be worked out with the legislature later on,” Ms. Tionko added.
The law was inked in 2005 but was never properly implemented, she noted, as it gave rise to lawsuits when the parties are charged accordingly.
“It was implemented in the past, but I think what happened, they sued the board, and the other one when they gave the reward, they ( board) were charged,” Ms. Tionko recalled.
Under Republic Act 9335, or the Attrition Act of 2005, revenue officials who fall short of their collection targets by at least 7.5% would be dismissed from service while those who surpass their targets would be rewarded with cash and other incentives equivalent to 10% of the excess.
The BIR in June grew collections by 6% to P131.2 billion, but missed its P141.7- billion target by 7%, while the BoC’s take steadied at P35.4 billion, although likewise short of the P39- billion goal.
This year, the BIR is tasked to collect P1.829 trillion while the BoC targets to rake in P467.9 billion, according to the BESF.
Legislators have been calling on the DoF to fully implement the law after several corruption controversies hit the BIR and BoC. They said that the implementation of the law would support the tax reform program as it is expected to boost collection efficiency.
Ms. Tionko said that despite the proposed amendments, the DoF would still be on track of its implementation this year.
“It will be difficult, but we would try our best to implement it. Because you have to apply it to a full year 2017 and then next year. We are preparing for that by trying to amend the IRR,” she said.
DUBIOUS ASSESSMENTS
Meanwhile, Finance Secretary Carlos G. Dominguez III said that they may include in the IRR a measure to hold tax assessors liable when making dubious assessments, following the Del Monte Philippines, Inc. case wherein the company has been accused of avoiding the payment of almost P30 billion in taxes over a threeyear period.
“One of the things that we are trying to do is develop rules to hold the collectors on account for their assessments. You know some of their assessments are totally out of this world, and that is one of the reasons why we have this controversy like Del Monte,” said Mr. Dominguez.
“So I think because they are not called to account [ when] they make these wild assessments, it causes a lot of expense on the part of the taxpayer and then after, actually when you get down to it, the assessment is nowhere near reality. So we are trying to implement a way on how to curb these abuses and harassment techniques,” the Finance chief added.