DoF eyes new revenue collection tack

Although some customs and tax officials may still lose their jobs over missed collection targets, the Department of Finance is now looking at a more localized and “inclusive” method for setting goals.

According to Finance Secretary Cesar V. Purisima, he is “not yet comfortable” with the revenue agencies’ goal-setting process—especially that of the Bureau of Customs—which is currently based on macroeconomic factors.

“Obviously, they’ll have to meet their side of the bargain, which is to exceed their targets,” Purisima said.

The current system is spelled out in the Later Attrition Act of 2005, which entails a risk-reward scheme where customs officials may get incentives if they exceed the target, but are subject to transfer, demotion or even termination if they fail.

The law was supposed to address the twin issues of low revenue collection and graft and corruption in the Customs agency and the Bureau of Internal Revenue.

However, calls for the law’s amendment or repeal have been raised amid worries of mass layoffs on one hand, and manipulation of collection systems to gain bonuses on the other.

“To properly implement (the law) and to be fair to all concerned, goal-setting should be done in an inclusive manner where you involve all those that would be affected, and the goals should be based on more hard facts,” Purisima said.

“Right now they are really based on macroeconomic factors that are hard to break down by region and by district,” he added.

According to the finance chief, it is important that the target setting is “done properly,” for which an information system is needed.

Last month, the Cabinet-level Budget Development and Coordination committee decided to reduce the BoC’s target for 2012 to P347 billion from P365 billion.

Even then, Customs Commissioner Ruffy Biazon was quoted as saying that the new target was still challenging since it represented an increase of more than a quarter over the previous year’s goal of P276 billion—itself a reduction from the original P320 billion.

Biazon said an ideal rise in collection targets should just be about 15 percent higher than that of the previous year.

In January Budget Secretary Florencio B. Abad said the government would infuse P192.6 million to rehabilitate and upgrade the BoC’s computer system amid efforts to shore up revenue collection.

Abad said the amount would be used to acquire hardware, software as well as services to address possible failures in the BoC’s “outdated and overloaded” nationwide system.

Biazon has been actively pushing for digitization projects to reform customs operations and increase revenue intake, Abad added.