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Sweetheart deal

By Conrado R. Banal III
Philippine Daily Inquirer
First Posted 23:13:00 07/13/2009

Filed Under: Economy and Business and Finance

EVERYBODY KNOWS THAT somebody in this cute administration has been slamming into the BIR a big fat deal with a Swiss firm called SICPA Product Security SA.

Recently, however, when nobody was looking, the value of the deal miraculously levitated to more than P14 billion ... and still counting.

That?s because the price zoomed up to $300 million during the life of the contract, from the original $200 million set only about two years ago.

Don?t ask me, sweetheart, where the big difference will go, because I do not know! I swear! On second thought?

Anyway, all that money should go to the deal promoter SICPA. What does the BIR get in return?

Well, SICPA has been selling to this cute administration its tax ?stamps? on cigarette packs, coursing the deal through the Department of Finance (DOF).

The stamp system supposedly would help the BIR check the excise tax payments of the cigarette companies here for every pack that would come out of their factories.

To make the SICPA system work, the BIR only employs a multitude of checkers, going around the country (with 1,700 islands) to verify the presence of the SICPA-patented stamp with the SICPA-patented electronic gun.

How much does the BIR hope to collect in additional taxes from such a tedious system? Well, as of today, nobody still knows. Great!


ALL THIS time, the DOF has been, ah, promoting the SICPA system at the BIR, although two past BIR commissioners resisted it.

They were Jose Mario Buñag and Lilian Hefti. Both doubted the tax benefits to the government that the SICPA system was supposed to bring, as claimed by SICPA.

Our sources at the BIR point to a certain RD as the DOF point man in the deal, who is supposedly only a ?consultant,? hired by a top official of the DOF.

This guy also figured prominently in a military intelligence report, noting the widespread corruption at Bureau of Customs, pointing out that our hero RD has been fronting for somebody else at the DOF.

As top BIR officials would swear, our favorite RD also never missed the opportunity to lecture BIR officials, including the commissioner, and right in front of other people, on something that the BIR was supposed to be the top authority?meaning, taxation.

I heard that the nuisance RD attended meetings of BIR?s top officials. In what capacity, none of my sources at the BIR can as yet fathom.

From what I have heard, anyway, this super consultant RD is behind the other controversial moves of the DOF, such as the problematic tax ruling on imported books.

Somebody else is pulling the strings above the head of DOF undersecretary Estela Sales, do you think?

But I just do not know if Finance Secretary Margarito Teves knows all about RD?s modus operandi. Poor guy!


AND FROM what I have gathered, anyway, as opposition to the big fat deal mounted?particularly in the NEDA and in Congress?this SICPA now has a new tack.

It is establishing alliances with antismoking groups, claiming that its system will help people quit smoking. Oh, yeah?

In fact, if the BIR would only go along with the SICPA deal sponsored by the DOF, SICPA would promise to donate to the government about P10 million?to be used in antismoking campaigns.

Okay?such a sweetener is not even equivalent to 1 percent of the total amount of the big fat contract.

But never mind the money! It?s the annoying deception that this foreign firm is trying to inflict upon this country.

Look here, Buccaneer, to make money in its deal with this cute administration, SICPA must pray that Filipinos continue to buy a lot of cigarettes, since SICPA get paid by the pack of cigarettes using its ?stamp.?

Again, SICPA?s ability to make money here depends on cigarette sales.

Yet, as if to sweeten the P14-billion peso deal, SICPA now promises to give money to the government for antismoking campaigns, which should redound to less cigarette sales, which in turn should be bad for SICPA?s business here.

Anything, really, just to get the deal!


FORMER PRESIDENT Fidel V. Ramos (Ramos Peace and Development Foundation) and former Finance Secretary Roberto de Ocampo (RFO Center for Public Finance and Regional Economic Cooperation), will hold their lecture series this year on July 16, at the RCBC Plaza in Makati.

The theme is ?Six Year Socio-Economic-Peace Program,? with presentations by (presidential?) candidates Senators. Francis Escudero, Richard Gordon, Loren Legarda, Mar Roxas II and Manuel Villar Jr.; Defense Secretary Gilbert Teodoro and MMDA chair Bayani Fernando.

Former Press Secretary and presidential spokesperson Mike Toledo, president and CEO of the global PR firm Weber Shandwick Philippines, will moderate the open forum.

Hmm, that should be interesting.

Copyright 2015 Philippine Daily Inquirer. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.




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