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Sunday, July 11, 2010

Bureau of Internal Revenue

BIR to rationalize programs

A surfeit of programs at the Bureau of Internal Revenue (BIR) will be reviewed as the Aquino administration moves to address a massive budget deficit, the new tax chief said on Friday.

"I believe it is hard to monitor 105 programs so we would probably rationalize it, merge some of the programs so that it is not redundant," BIR Commissioner Kim Jacinto-Henares said in a briefing.

She did not detail all 105 programs but said revenue generation and improvements to enforcement and tax administration would remain the priority. Schemes such as the Run After Tax Evaders (RATE) and Oplan Kandado -- which involves the padlocking of erring firms -- will be continued, she added.

The controversial implementation of the value-added tax (VAT) on tolls -- which the BIR has been trying to do since 2005 -- will also push through, Ms. Jacinto-Henares said.

"The VAT on toll is not a new tax. My position is the BIR has no authority to say which taxes should be imposed or not but just to implement what is in the law. This is in the law so we have to implement," she said.

Asked when the scheme -- supposed to have been finally implemented last April but deferred for finetuning -- would be implemented, Ms. Jacinto-Henares it would depend on the outcome of protracted talks.

"I believe there is an ongoing discussion with TRB (Toll Regulatory Board) and toll companies. I will just follow on with that discussion and find out the agreement. I think the past administration talked about August 16. I don’t know whether that will push through or not. It really depends on the ongoing discussion," she said.

The issue of dunning toll operators back taxes amounting to some P6.5 billion for the years 2007 to 2009 will also have to be discussed, she said.

The BIR will be also reviewing its options with respect to a negotiations with SICPA Security Solutions SA for a cigarette stamp project to monitoring cigarette firms’ tax payments.

The Large Taxpayers Service will also be up for scrutiny, particularly with respect to updating its coverage list and also in terms of pushing taxpayers to move towards computerized accounting systems, Ms. Jacinto-Henares said.

Improved working conditions for BIR personnel will also be a priority, she said.

Ms. Henares on Thursday said the BIR, along with the Bureau of Customs, would be working to achieve a tax effort equivalent to 15% of gross domestic product within a year, from just 12.8% in 2009.

This year’s collection goal of P830.4 billion will be maintained, she also said.

The agency’s collections as of end-May totalled P344.1 billion, exceeding the P323.8-billion goal for the period.

Last year, the BIR fell short of its P798.5 billion target by P48.2 billion, collecting only P750.3 billion due to a business slowdown blamed on the global recession.

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