Finance department eyeing privatization of some BOC, BIR work

The Department of Finance is mulling to privatize certain tax administration activities of the Bureau of Customs (BOC) and Bureau of Internal Revenue (BIR) as part of the comprehensive tax reform program.

In a speech before members of the Federation of Philippine Industries last Friday, DOF Assistant Secretary Mark Dennis Joven said that “if it is necessary to privatize certain aspects of the Bureau of Customs’ work, we will consider that thoughtfully.”

Joven said it was part of the reforms they were eyeing in the BOC to make the agency “less vulnerable to corruption and more effective in its job of raising revenues for government.”

He later told reporters that the DOF was currently undertaking a study of privatizing certain functions not only of the BOC but also of the BIR.

“Legally speaking, if it’s a sovereign function, we cannot privatize it. So we need to identify in their value chain what can be privatized and whether doing so would make things more efficient,” Joven explained.

In the case of the BOC, “we’re studying whether or not some customs functions may be privatized legally, and assuming we can’t, we can just solicit help from the industry groups to at least help in ensuring that importations are reported correctly,” Joven said.

The DOF official noted that in Europe and Singapore, for instance, some customs processes, such as processing of refunds, are done by private firms.

As for the BIR, Joven said the private sector may be involved in the production of cigarette tax stamps, which is currently being subcontracted by Irsis Corp. to state-run printer APO Production Unit Inc. CBB