DOF official quits as Teves fails to hurdle CA

MANILA, Philippines – A ranking finance official has resigned following the failure of Finance Secretary Margarito Teves to hurdle the Commission on Appointments (CA).

Finance Undersecretary Gaudencio Mendoza Jr. has tendered his resignation effective April 1, 2008 but has yet to issue a statement to explain his decision. Teves confirmed Mendoza’s resignation yesterday.

Some finance department employees blamed Mendoza’s presence at the DOF for Teves’ failure to hurdle the powerful CA.

Mendoza, who joined the department in 2006, penned the controversial DOF ruling on the Pall Mall cigarette tax issue.

The DOF ruling, which has been widely and strongly criticized by lawmakers, reversed a decision by the Bureau of Internal Revenue (BIR) on Pall Mall cigarettes.

The BIR had slapped Pall Mall cigarettes with an excise tax rate of P26.00 per pack for being high-end. It is sold at Duty Free Shops.

British American Tobacco, owner of the Pall Mall brand, appealed to the DOF, which then reversed the ruling and instead taxed Pall mall at a lower rate of P6.74 per pack.

Mendoza later reversed the ruling anew and affirmed the BIR’s original ruling of a higher excise tax on Pall Mall.

Mendoza drew the ire of lawmakers led by Sen. Juan Ponce Enrile after he issued the Pall Mall ruling of P6.74 per pack.

Prior to his resignation, Mendoza headed the DOF’s all-out campaign against erring revenue officials and employees under the RIPS (Revenue Integrity Protection Service).

Teves has asked Finance Undersecretary Gil Beltran to oversee the operations of the agency’s Revenue Operations Group so as not to derail the government’s campaign against corrupt officials and employees.

“The RIPS of the DOF will continue to vigorously run after erring revenue officials. We will not let up in the fight against corruption in order to improve revenue collection and hence, sustain economic growth and reduce poverty,” Teves said yesterday.

Meanwhile, Cabinet members whose appointments the Commission on Appointments failed to confirm before the Lenten break of Congress need not be reappointed, Isabela Rep. Rodolfo Albano III said yesterday.

“We have changed the rule that Cabinet officials whose appointments are not approved before a recess or break are considered bypassed. They will be considered bypassed only if they are not confirmed before a sine die adjournment, which is the mandatory vacation in June one month before the opening of the next regular session,” he said.

Albano said in the past, every recess, break or vacation, even if it was just a week or two weeks, was considered an adjournment.

“Following that ruling and precedent set by the commission, the President had to reappoint Cabinet members who were not confirmed before a recess or break,” he added.

He pointed out that under the new ruling, a Cabinet member would be considered bypassed only once during a regular session of Congress.

Thus, President Arroyo need not issue new appointment papers to Cabinet members who were not confirmed before Congress started its five-week Lenten break last Friday, he stressed.

These officials include Finance Secretary Teves, Interior Secretary Ronaldo Puno, Energy Secretary Angelo Reyes, and Environment Secretary Lito Atienza.

Albano said the new ruling would also apply to military officers and diplomatic personnel whose promotions were still pending last week, including those whose confirmation were blocked by Sen. Jamby Madrigal.