THE tax collection efforts of the Bureau of Internal Revenue (BIR) in slashing delinquent accounts proved to be dismal in 2012 as these unpaid dues skyrocketed to 188-percent increase almost reaching the P300-billion mark.
The Commission on Audit (COA) in its 2012 report on the tax bureau discovered that
“delinquent accounts increased by 188 percent in 2012,” or from P103.75 billion to P298.98 billion, despite the agency’s monitoring of the unpaid dues.
Generally, a delinquent account is any account wherein no payment has been made past its due.
“The low collection rate of delinquent accounts affects the collection efficiency of the Bureau and resulted in lesser funds for the government,” state auditors underscored.
COA said that ironically the BIR included in its 2012 priorities “the monitoring of delinquent accounts stressing on its collection effort, collection efficiency and processing efficiency.”
Verification of records and reports on these accounts in selected revenue offices otherwise showed increases in delinquent accounts.
In Bicol region, the accounts increased by 35 percent to P7.94 billion in 2012 from P4.5 billion in 2011.
In Western Visayas, a 117-percent increase was seen with P11.41 billion scaling up to P24.5 billion.
In Central Visayas, a huge stride was seen with P7.72 billion to P40.63 billion, or a sharp rise of 174 percent.
In Eastern Visayas, delinquent accounts amounting P8.45 billion in 2011 increased to P17.98 billion, or a 72-percent rise.
Records from the National Office’s Large Taxpayer Service show the accounts leapt from P1.6 billion to P48.92 billion in 2012, or an 85-percent increase.
Only records from the collection and enforcement division posted a decrease of 58 percent from P14.29 billion in 2011 down to P7.52 billion.
Government accountants added that disclosures from the general control ledger showed the amount of delinquent cases resolved actually increased from P5.8 million to P9.6 million.
Ironically, “instead of a decrease in delinquent accounts because of the increase in the cases closed, the year-end balance increased” from P103.75 billion to P298.98 billion.
COA noted that the bulk of the increase was in the legal service amounting to P92.61 billion, which the BIR did not include in the previous years’ ledger.
When the audit agency also reviewed the 344 old accounts for compromise and abatements in CED worth 1.41 billion, they noticed slowpoke movement in the resolution of these cases.
“[The old accounts] did not register any movement though the cases were initiated years ago. Those pertaining to 2011 and 2012 reflected either a minimal or no movement at all,” COA said.
The audit commission added that out of the P155.07 billion worth of cases handled, only P310.38 million was collected, while P824 million was cancelled.
“It is noteworthy that the amount of cancelled assessments through the [authority to cancel assessment]was 265 percent, or almost triple the amount collected,” COA said.
Auditors reiterated to the tax collectors to intensify collection efforts on delinquent accounts “to increase revenue for government projects and programs.”
In its reply, BIR said that in March 2013, the centralized collection of delinquent accounts was piloted in four unnamed Metro Manila Regional offices.
Prioritization of cases for those with high probability of collections will be implemented to maximize the limited personnel of the bureau.
“If the outcome of this strategy will be successful, the same approach shall be implemented nationwide,” BIR said.