DOF officials nix proposal to defer Lateral Attrition Law

Finance officials have thumbed down a lawmaker’s proposal to defer the implementation of the Lateral Attrition Law of 2005.

Valenzuela Rep. Magtanggol Guinigundo proposed the deferment of the law due to the global financial crisis. He reasoned the worldwide economic turmoil could affect the collection targets of many revenue officials.

 However, two ranking officials from the Department of Finance said it would not be necessary to defer the law’s implementation because the government’s review committee takes into consideration all factors that affect revenue targets including external influences.

 “The Bureau of Internal Revenue (BIR) and the Bureau of Customs (BOC) can always say that the macroeconomic assumptions (used in setting revenue targets) were not realized,” one official said.

Another Finance official said it would be up to Congress to decide on the matter because it was Congress that wanted the law.

 Nonetheless, the official added it is not necessary to defer the implementation of the law, adding such move would merely discourage revenue officials who are performing well.

The Lateral Attrition Law provides for a system of reward and punishment for BIR and BOC officials and employees depending on their performance. Those who fall short of their collection targets by at least 7.5 percent would be dismissed from service while those who go beyond expectations would be given incentives which may include cash.

 In his proposal, Guinigundo said due to the current financial situation the world is facing, it is possible that many revenue officials may not meet their targets and it is not because of their inefficiency but due to the financial crisis.