Lawmakers criticize BIR, Customs for missing targets

MANILA, Philippines – Lawmakers criticized the Department of Finance (DOF) for its revenue collection agencies’ failure to meet their targets.

In the budget hearing at the House of Representatives on Monday, September 10, lawmakers cited the failure of the Bureau of Internal Revenue (BIR) and Bureau of Customs (BOC) to collect as much as expected, thus they are blocking the proposed 2013 national budget of P2.006 trillion.

The government expects to raise P1.78-trillion in revenues in 2013, which is 14.1% higher than the revised 2012 program and equivalent to 14.9% of the GDP target.

“Bottomline is, figures don’t lie. I’m now thinking about 2013…In 2011 they did not meet their target, 2012 they will not meet their target, in 2013, they will also not meet their target because you still have the same people running the show who have not done much to institute change,” said Zambales Rep. Mitos Magsaysay.

“The reason why I’m very hard on the DOF is because they are the first step for this budget [GAA] to succeed,” Magsaysay said.

Revenues these two agencies collect account for bulk of the funds the government spends for social services, security, education, among others. The government borrows abroad and locally to plug the difference.

Finance Secretary Cesar Purisima, who was at the hearing, did not respond to Magsaysay’s tirades. Samar Rep. Mel Senen Sarmiento replied to questions on revenue issues.

Sarmiento admitted that, indeed, the BIR and BOC were unable to meet their targets in 2011 and have yet to meet their targets this 2012.

In 2011, Sarmiento said that the BIR’s collections deficit was P15.9 billion while the BOC’s was larger at P54.9 billion.

In the first 7 months of 2012, Sarmiento said the BIR only collected P604.6 billion while the BOC, P167 billion.

Magsaysay noted that with 5 more months until yearend, the BIR and BOC must reign in more than P100 billion each to meet their respective 2012 targets.

Sarmiento said the BIR’s revenue target this 2012 is P1.66 trillion while the BOC’s target is P347 billion.

Both agencies have a name-and-shame campaign to improve tax administration by going after and filing cases against tax cheats and smugglers.

They have reported that monthly collections have been more than last year’s.

International agencies Fitch, Standard & Poors, and Moodys, have cited the government’s manageable budget deficit level for upgrading their credit rating on the Philippine sovereign issues to one notch below investment grade. – Rappler.com