New BIR chief open to compromise on tax evasion

Newly installed Bureau of Internal Revenue (BIR) Commissioner Jose Bunag said yesterday he is open to a compromise settlement with movie actors, actresses and businessmen recently slapped with tax evasion charges under the government’s Run After Tax Evasion (RATE) program.

In a news conference at the Department of Justice (DOJ), Bunag said he would be willing to negotiate with movie personalities such as Judy Ann Santos, Richard Gomez and Regine Velasquez to reach settlements on their tax bills.

Bunag said there are two ways to get the BIR to agree to a compromise settlement — first, if the assessment of the alleged tax liability is doubtful; and second, if the financial capacity of the taxpayer is in question.

He said his predecessor, resigned BIR commissioner Guillermo Parayno, and former finance secretary Cesar Purisima, who initiated the implementation of the RATE program, have already sent a strong message to taxpayers that the government is serious in its effort to improve the country’s tax collection.

"I will be the judge at the end of my term on how much I collected, but not on how many people we sent to jail," Bunag said.

The new BIR chief said he proposed to the Department of Finance (DOF), the BIR’s partner in the RATE program, that compromise settlements be reached with personalities facing tax evasion cases, those who are the subject of investigations and those about to be charged.

Apparently the RATE program has worked, he said, because a lot more people are now paying their proper taxes.

He clarified, though, that the BIR will not accept reduced tax payments for any settlements. The total amount due must be paid.

However, the question of whether those slapped with tax evasion charges will be exonerated or not has yet to be decided by the BIR and the DOF.

"Our proposal is to accept the payment and not to pursue the case. But we still have to discuss this matter," Bunag said.

The DOF, on the other hand, is not keen on any special arrangement and wants to hold off on any compromise talks.

Obviously, the new BIR chief is taking a new tack in the perennial tax collection challenge.

"My understanding is that the RATE program is to encourage people to pay the taxes. If they will offer to pay, why not accept the payment? What is important is that the message has been sent to the people that we are serious and we mean business," Bunag emphasized.

The BIR, he added, is also preparing contingency plans in case the Supreme Court junks the legality of the expanded value-added tax (EVAT), one of the tax measures that the Arroyo administration is banking on to raise revenue collections and prop up the economy.

There are other legislative measures that the BIR will propose, Bunag said.