Every year, the government’s main revenue-generating agencies set collection targets to fund government projects and programs. The Department of Finance estimated a total of P2.806 trillion in government revenues for 2018. The bulk, worth P2.039 trillion, is expected to come from the Bureau of Internal Revenue, while P581.3 billion shall be generated by the Bureau of Customs.
As reported by the Bureau of Treasury, the total revenue collection for the first half of 2018 reached P1.41 trillion, which is 9 percent higher than the target. The BIR collected a total of P967.4 billion from January to June 2018. This gave DOF Secretary Carlos Dominguez confidence that the collection target will be attained by the end of the year.
I note the improvement in the collection efficiency of the revenue-generating agencies in 2018, but the real test is on their “consistency.” How long can they sustain this improved revenue collection? I would like to remind the BIR and the BOC that they have been failing short of their targets in the previous years. Last year, the BIR collected 97.19 percent of its P1.829-trillion target, while the BOC collected 97.86 percent of its P467.9-billlion target. To effectively and consistently improve tax collection, the DOF should consider the full implementation of the Lateral Attrition Law.
Republic Act No. 9335, or the Attrition Act of 2005 provides a punishment-and-reward system towards officials and employees of revenue-generating agencies. Under the law, if the agency exceeds its target, it is entitled to rewards and incentives equivalent to 10 percent of the excess over its allocation target. However, if tax collectors fail to meet their collection targets by at least 7.5 percent, they will be removed from office, in accordance with the criteria established by the law.
I have been calling for the urgent action of DOF Secretary Carlos Dominguez with regard to this matter since the Duterte administration started. On this week’s meeting of the House Committee on Ways and Means, I was informed by DOF officials that the agency is still rehashing the Implementing Rules and Regulations of the law. However, this was the same thing they told me in 2016. I wonder what is taking them so long. This only further delays the implementation of the law.
With the passage of the Tax Reform for Acceleration and Inclusion Law, the DOF should double its efforts towards the improvement of tax collection of the revenue-generating agencies. Hence, I reiterate that the benefits of additional revenue will be diluted if the problems in collection are not addressed.
Come plenary budget deliberations, I will take this concern to the floor. Together with the fellow lawmakers from the Minority, we would get DOF’s commitment to effectively implement the Lateral Attrition Law by year-end. We will scrutinize their budget and review the targets of the BIR and the BOC. With the government’s P3.757-trillion proposed appropriations for 2019, we need a consistent and efficient revenue collection to effectively implement the 2019 General Appropriations Act.