Press Release
June 21, 2007

TAX COLLECTION NEEDS AN IRON FIST - ROXAS

Senator Mar Roxas said government efforts to improve the tax collection system are commendable, but an iron fist is needed if the country is to meet its revenue goals.

He was reacting to the removal last Wednesday of BIR Commissioner Jose Mario Buñag, with Deputy Commissioner Lilian Hefti put in charge for the meantime.

A change in the bureaus leadership must coincide with a strong political will that results in a relentless and sustained campaign against tax evaders and tax cheats, Roxas said.

The chairman of the Senate committees on economic affairs and trade and commerce noted that the administrations uncertain position on whether to proceed with a revamp of the Bureau of Internal Revenue (BIR) has taken its toll, with the latest collection report showing a dismal P41.8-billion budget deficit from January to May.

The shortfall is over P10 billion behind the P31-billion deficit target for the first semester of 2007. In May alone, the government experienced a P1.7-billion deficit as compared to the P5.8-billion surplus in the same period last year. The full-year target is a P63-billion deficit.

Finance department data show actual collections from January to May amounted to P285.6 billion. While this is 6.6% higher than the same period last year, this was still short of target. The BIRs target for the year has been set at P765.9 billion.

Our people deserve to know the real picture because these shortfalls affect our financial standing as a country and the governments capacity to provide better services to its constituents, he said.

The average consumers sacrifice in shouldering the EVAT must be matched by the BIRs zeal in running after big time tax evaders, Roxas said.

He added, Let us not forget that the more taxes collected, the more money there is for putting up more hospitals and classrooms, for the hiring of additional health care workers and teachers, and building more roads and bridge to connect remote towns to progressive cities. This is part of the Liberal Partys advocacy and affirmative action plan to earmark EVAT funds for health and education purposes.

Roxas said the Lateral Attrition Act of 2005, which provides a system for rewarding and penalizing collection officers according to their ability to meet targets, cannot be simply set aside. The Executive should explain why the Lateral Attrition Act has been deferred and how long it will stay unimplemented. I recall that this was included as part of the fiscal reform legislative agenda together with the EVAT Law which they deemed as vital and urgent, he added.

Meanwhile, the senator expressed concern over the offer of an ambassadorial position to former head of the BIR:

There is no question that the President has the prerogative of appointing individuals outside the Philippine Foreign Service to ambassadorial positions. However, this prerogative must take into account the professionalism and morale of our own diplomatic corps.

The offer of an ambassadorial position to Commissioner Bunag, which he thankfully declined, is an affront to career ambassadors, some of who are still awaiting foreign assignments. It also downgrades our diplomatic relations with receiving countries. The executive branch should forego this practice and avoid using our diplomatic posts as halfway homes for outgoing public officials.

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