Arroyo wants to change BIR into National Revenue Authority

January 15, 2017

Deputy Speaker Gloria Macapagal Arroyo of Pampanga has sought to overhaul the Bureau of Internal Revenue and naming it the National Revenue Authority (NAR).

“There is an urgent need for Congress to create a revenue authority to address the growing taxpayer dissatisfaction particularly over front-line services, high level of tax evasion/avoidance, and increasing perception of systematic corruption in the Bureau,” said  Arroyo.

Arroyo, who president of the Philippines from 2001 to 2010,  said past efforts to reorganize the BIR were unsuccessful because there were made through administrative decree.

She added  the BIR is hampered by at least three  constraints: (a) rigid personnel management system where promotion is based merely on loyalty and seniority rather than exemplary performance (e.g. exceeding the revenue target); (b) compensation structure that restricts the hiring of first-rate  professionals; and (c) strict line-item budgeting that limits the flexibility in the allocation of funds.

With the National Revenue Authority, Arroyo said tax collection can start on a clean slate since it will be  free from political interference in terms of decisions pertaining to revenue rulings, audit and assessment personnel management, and budgeting.

Under her bill,  Arroyo said the NRA will be governed by a revenue board composed of four representatives from the government and three from the private sector.

The government representatives shall include the heads of the Department of Finance (as chairperson), the Department of Budget and Management, the National Economic Development Authority and the Securities and Exchange Commission. Private sector representatives shall be nominated by peak professional organizations, and appointed by the president of the Philippines.

She added private sector representatives must be experts in economics, accounting, law, business management and other allied professions and will serve for a fixed tenure of office with different periods of expiry to avoid disruption of services, prevent abandonment of approved plans and to limit reversal of revenue rulings and regulations. DMS