Clean up first

Do unto yourself, before you do unto others.

In the face of dwindling revenue collections, the Bureau of Internal Revenue has been hard pressed to find ways to collect taxes.

Desperate times may require desperate measures, but any policy or action should be based on logic and not half-baked instant solutions.

The two suggestions that taxes be imposed on campaign contributions and bazaars or tiangges in order to add to revenue collections certainly grabbed peoples’ attention but offered little else.

To begin with, the BIR official who came up with the idea admitted they had no clue how to go about it! They had a bright idea and decided to announce it but no clear plan or process to go about it.

How can anyone give a solution that you don’t even know how to apply!

Before the BIR launches this not so bright idea, their officials should begin by hunting down BIR insiders in Quezon City and Manila who have successfully diverted millions upon millions of pesos in bribes instead of collecting taxes for the government.

Early this year I spoke with three different Chinese-Filipino groups from Manila, Quezon City and Batangas about paying taxes to government. These were men and women in business who wanted to align their faith and what they learned in church with the way they conduct business.

For weeks they attended sessions on tithing and “paying unto Caesar what is Caesar’s”, they even spoke to tax consultants and professional accountants. Sadly more than half the crowd eventually folded up and caved in to pressure and made “lagay”.

They sadly recounted how they were “convinced” by “nice BIR insiders” that it would be easier and wiser to pay-off certain revenue officials at the BIR instead of coming clean and paying taxes they owe to the government because they would be harassed and charged by the people who did not get their annual ill-gotten wealth.

On one occasion, I surveyed five different businessmen on how much they paid to their “collector” at the BIR. Little did they realize that their grand total amounted to more than P1 million. My Manila contact estimated that all the shops on her street coughed up close to P20 million. Their average was anywhere between P200-350,000 in bribe. In Batangas, the going rate for a medium size business was about P200,000 to a “ lady collector”.

No matter how we try to convince people to pay their taxes, it’s not going to happen if the Department of Finance does not implement an eradication program against corrupt officials at the BIR. We have long suggested that Secretary Teves must declare a Tax Amnesty program on the condition that those pardoned must turn in their “pet collector”.

It is not an impossibility to imagine that the Arroyo administration could have achieved its revenue targets if a serious effort had been done to eradicate the corruption and harassment. Perhaps President Arroyo can create a permanent body that will shield people from such harassment as well as operating as an internal affairs group to act on reports of BIR bribery.

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It goes without saying that the eradication program should also extend beyond the BIR, to the Bureau of Customs as well. For as long as people believe that Secretary Teves has no desire or power to remove any official of customs even the Commissioner, then the downhill slide of revenue collections will go on.

The DoF might as well change their revenue collection forecasts and write down: WHATEVER. 

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People who don’t like politicians that enrich themselves with leftovers from campaign contributions certainly welcome the idea of putting a tax on all campaign contributions. But no one, not even the BIR, ever came up with a suggestion of INVESTIGATING all the people who give campaign contributions.

Either way, one would assume that anyone making a substantial campaign contribution would have substantial resources or finances. Wouldn’t it make sense to investigate them about their tax payments first? Somewhere down the line there will be at least a handful whose numbers and resources don’t match and that’s where the BIR can come in and start collecting the revenue due them.

If politicians don’t like the idea, it probably has to do with the fact that the idea will also reveal who influences or whispers sweet something’s into the ears of lawmakers and the administration.

With a system in place, it would be much easier to pinpoint which business tycoon, industry or lobby group makes substantial contributions to which politicians. Without a doubt, we will then know if an environmentalist is actually in bed with the tobacco industry, or if jueteng money or revolutionary taxes are funding certain candidates.

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As for taxes on bazaars and tiangges, there is such a thing as logistically unprofitable and politically stupid. The seasonal markets to begin with is short term, small profit, and largely more of “something to do for the unemployed”, and part of the traditional Yuletide season’s activities.

If the BIR had to track down each vendor, document them and systematize the hundreds of bazaars that would require a small army of people who would have to work on weekends, chances are the BIR people would rather go shopping instead of sleuthing.

By the way, half of the bazaars that go on are also fund raising activities held by various diplomatic ladies corps, churches and NGOs that donate their proceeds to charity.

I guess, after all is said and done, the problem of the Department of Finance is inside the department and not the taxpayers.