GMA cracks whip on revenue agencies

President Arroyo is cracking the whip on the government’s revenue agencies with low collections in the first two months of the year.

Mrs. Arroyo noted the low collections of the Bureau of Internal Revenue (BIR) and the Bureau of Customs (BOC) as compared to the same period last year.

Although she admitted the low collections might have been due to the temporary downside of the strong peso, the President said this factor is no excuse for low revenue collections for this year.

"They (BIR and BOC) really have to improve their tax administration," Mrs. Arroyo said.

From January to February, the BIR collected P91 billion in revenues, lower than the P91.2 billion collected during the same period last year.

The BOC collected P25.2 billion in the first two months of the year, lower than the P25.2 billion it raised during the same period in 2006.

Mrs. Arroyo said revenue officials had explained the shortfall as caused by the strong performance of the peso.

"The strong peso makes the peso value of the imports go down so therefore the earnings, the revenues go down," she said.

"Our very good economic performance reduces our interest income, the income of many interest receivers, therefore their tax payments also go down."

Notwithstanding the low collection in the first quarter of this year, Mrs. Arroyo said this is not as bad as it seems "nonetheless it’s a good occasion to check on their tax administration."

On the other hand, because the performance of the peso is strong, the government should spend less on imported products as well as on interest, she said.

"So if the revenues are going down, the expenditures are also going down but overall we will still be below our deficit ceiling," Mrs. Arroyo said.

The government is targeting a deficit of P63 billion this year to pave the way for balancing the budget by 2008.

Mrs. Arroyo, however, said she is not so much in a hurry to wipe out the deficit since it would be better to use government resources for vital socio-economic projects instead of using revenues to balance the budget.

Socioeconomic Planning Secretary Romulo Neri said the BIR and the BOC should be sharing more information "because you can get very valuable information if they share their information on taxpayers."