By Prinz Magtulis (The Philippine Star)
| Updated June 21, 2016 - 12:00am
Henares (left) and Dulay
DAVAO CITY, Philippines – All pending
tax investigations and audits will be stopped on day one of the new
administration, the incoming chief of the Bureau of Internal Revenue (BIR) said
yesterday.
“We have considered initially, for the
first day (of our term), to recall all letters of authority (LOA),” Cesar Dulay
told businessmen on the first day of the Sulong Pilipinas workshop here.
The workshop is being held until today
by the incoming administration to consult with business leaders on the
specifics of its economic agenda.
The BIR issues a LOA to inform a
taxpayer that he or she is being investigated for possible tax violations.
But according to Dulay, he received
information that probes conducted under LOA are being abused and could last for
“two to three years.”
“We should put a cap on that period
because it is an opportunity for what we can call negotiation (for
corruption),” Dulay said.
Dulay also vowed to conduct an
“immediate review” of revenue regulations to ensure tax requirements are
reduced as part of ease of doing business.
Dulay’s pronouncements comes after a new
spat between outgoing Internal Revenue commissioner Kim Henares and industry
group Tax Management Association of the Philippines (TMAP) over the issuance of
two revenue regulations weeks before Henares steps down.
Revenue Memorandum Order 24-2016 laid
out tax probe rules for property buyers and sellers found not to have financial
capacity to hold onto their assets. It was issued last June 7.
Meanwhile, Revenue Memorandum Circular
62-2016 clarified how banks and non-banks should treat “passed-on” gross
receipts tax to their clients. It was issued June 13.
Sought for comment, Henares said Dulay
“could do whatever he wants within his power” once he takes over.
TMAP president Benedict Tugonon
supported both plans, saying BIR should not be given excessive discretion
against taxpayers.
Specifically, he expressed optimism a
review of the issuances would allow the reversal of regulations he deemed are
against the National Internal Revenue Code of 1997.
“We hope it will clear inconsistencies
with the Tax Code and also take into account the tendencies of over regulation
and simplification,” Tugonon said in a phone interview.
On the dismissal of all LOA, the TMAP
chief said there was a need to check BIR’s “very powerful” tool against
taxpayers.
“The exercise of this LOA should be done
with caution because this could be very destructive to taxpayers. We support
moves to make the issuance of the LOA as objective as possible,” Tugonon said.
