BIR to revive Operation RATE

Posted at 07/15/2009 8:14 PM | Updated as of 07/15/2009 8:21 PM

MANILA - The country's main tax collecting agency is set to revive the previously shelved high-profile campaign against tax dodgers.

As part of efforts to improve tax collections, the Bureau of Internal Revenue (BIR) is breathing new life to Operation RATE (Run After Tax Evaders), which previously exposed alleged tax liabilities of public personalities including Asia’s song bird Regine Velasquez, actor-politician Richard Gomez, soap opera princess Judy Ann Santos, singer-broadcaster Claire dela Fuente, talent manager Douglas Quijano, basketball star Paul Asi Taulava, Dr. Joel Mendez, fitness instructor Tina Aboitiz-Juan, and Agriculture Secretary Arthur Yap, among others.

Operation RATE would be added to Oplan Kandado, which BIR Commissioner Sixto Esquivias IV launched early this year. About 50 small and medium businesses were padlocked under Operation Kandado, but the tax collections continue to miss targets.

Esquivias then issued Revenue Memorandum Order 23 – 2009 requiring the agency's National Investigation Division (NID) to audit corporate taxpayers for potential high profile tax dodgers, as well as government and state-owned units to ensure that these government agencies are correctly withholding and remitting taxes.
 
“The conduct of audit and enforcement activities continues to be one of the revenue service’s effective means to encourage voluntary compliance and discourage tax evasion,” Esquivias stressed.

He added that NID is also tasked to map out various schemes that companies employ to take advantage of entities with special tax privileges.
 
Cases developed by the NID under Operation RATE will be charged with tax evasion before the Justice Department, which would then determine if a case will be filed in a court or not.

There have been 120 cases filed by the BIR under Operation Rate. Of these, 96 cases are pending before the justice department, 13 are pending before regular courts, while 4 cases have been returned to the bureau for further evaluation.
 
The Justice Department had dismissed several RATE-related cases that were filed during the time of former Finance Secretary Cesar Purisima in 2005, including that of Velasquez's and Secretary Yap's.

RATE was part of previous economic managers' 3-pronged anti-corruption drive that included the anti-smuggling campaign called RATS (Run After The Smugglers) spearheaded by BOC, and RIPS (Revenue Integrity Protection Service), where complaints against erring revenue officers were filed at the Ombudsman’s Office.

These led to the highest ever April tax collections in 2005. April is the deadline month for companies to pay their income taxes.

Operation RATE was shelved after BIR implemented Republic Act 9480, or the Tax Amnesty Act, in 2008. This allowed delinquent taxpayers to settle their unpaid tax obligations.


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