Tax, Customs bureaus draw up 2009 collection plan

MANILA, Philippines - The Tax and Customs bureaus have lined up plans to enhance collection next year, knowing that 2009 will be a difficult year even as officials and employees remain under pressure to hit targets. The Bureau of Internal Revenue (BIR) must collect P910.9 billion, an adjustment from the P968.3-billion original goal, after the government saw how slower economic growth and the full impact of a tax relief law would hit collection. The Bureau of Customs (BoC), meanwhile, has been assigned to collect P317 billion, up from the original target of P300.1 billion, due to expectations of increased imports and a weaker peso. Under the Attrition Act of 2005, officials and employees who fall short of target by 7.5% can be removed from service. Those who exceed target, on the other hand, will be rewarded. Nelson M. Aspe, BIR deputy commissioner for operations, said the bureau would step up tax compliance in 2009. "[2008] has been a difficult year but more so 2009. We just have to cope. Our campaign for compliance will continue," he said. The BIR, he said, is launching "Oplan Kandado" in the wake of its "Premyo sa Resibo" and "NO OR (Original Receipt) Complaint" campaigns that led to the detection of establishments that do not issue ORs and/or are unregistered with the bureau. "We will close establishments that do not issue receipts," Mr. Aspe said. He also said the tax agency was stepping up its Run After Tax Evaders (RATE) program, which mandates the BIR to investigate violations of the Tax Code and assist in the prosecution of criminal cases that will "generate the maximum deterrent effect, enhance voluntary compliance, and promote public confidence in the tax system." The BIR is also expanding linkages with other agencies such as the Energy Regulatory Commission, Mines and Geosciences Bureau, and Bangko Sentral ng Pilipinas to increase tax collection. While collection rose by 11.4% year-on-year to P721.6 billion during the 11-month period, BIR is still very far from its P845.2-billion goal for this year. It is expected to collect just P810 billion. In a separate interview, Customs Commissioner Napoleon L. Morales said 2008 has been a "roller coaster ride" for the bureau given the rise and fall of oil prices in the world market, foreign exchange fluctuations, and the rise in rice prices. These events have largely favored the bureau, allowing it to collect more taxes from higher oil and rice prices and increased imports of the grain. Its target was thereafter adjusted to P274.1 billion from the original P254.5 billion for this year. As of November, it collected P241.5 billion. "It will be a tough job. We all know there is a financial crisis and an economic slowdown," Mr. Morales said of the bureau’s prospects in 2009. Among the bureau’s plans is to place 50 personnel in the regions in line with the creation of an Intellectual Property Rights Division. They will issue alert or hold orders for goods suspected of being fake. "There is a need for stronger coordination among different government enforcement agencies to curb intellectual property rights violation," Mr. Morales said, adding these personnel were trained in Japan. Implementing guidelines will be released next year on the accreditation of surveyors or inspectors of break and break bulk cargoes. These surveyors or inspectors must be located in countries where the Philippines sources imports. "What I want to happen is 12 hours before the arrival of the shipment, there is a surveyors’ report. This is an anti-smuggling effort," Mr. Morales said. Client profiling, which is a component of the bureau’s electronic-to-mobile or e2m Customs system, should be completed early next year. The e2m system involves a shift to paperless transactions, cutting the time before cargoes are released. Those who will use system — both exporters and importers, as well as other parties that transact with the bureau — will be asked to register under the client profile registration system (CPRS). CPRS registration is expected to help prevent fraud and other crimes. The CPRS registrants will be issued permanent customs client numbers and electronic signature needed for any e-document to be accepted in e2m system. "We won’t rely on the tax identification number (TIN), of which some are fake. We will have our own customs client number," Mr. Morales said. In line with the client registration, the BoC will appoint information validation service providers also early next year to verify the information in the documents submitted by registrants. Using Internet and mobile phone technologies, the e2m system is a commitment of the Philippines under the Association of South East Asian Nations Single Window Initiative, which enables the electronic exchange of export and import data among countries in Southeast and Northeast Asia. — R. A. M. Rubio, BusinessWorld