BIZ BUZZ: Mendoza shakes things up at BIR
To order Bureau of Internal Revenue (BIR) collectors to halt carpet-bombing taxpayers with Letters of Authority (LOA) is like speaking before a convention of cannibals, then praising the merits of veganism.
But that was new BIR chief Charlito Mendoza’s first message to the top ranks of the country’s main revenue collection agency when he first met them last week.
They were expecting their new boss to embrace without reservation the LOA regime, selling it as the “fear factor” that will drive up badly needed collections, the classic establishment capture of the new head.
But having been swamped with complaints of small businessmen—and even large taxpayers—who suffered “bankruptcy by LOA” or harassment in his prior post as the Department of Finance undersecretary for revenue, he instead called for LOA reform.
But to rehab the LOA, it must first be paused, and fix this bulldozer, which can drive small businesses to extinction.
So even before the hyperventilating senators had set their sights on the LOA, Mendoza’s order was in fact ready to be rolled out.
It was a unilateral move, not a reaction to the broadsides against the audit notice, which is received like a death warrant by struggling businesses and also a weapon of corruption.
While upholding the legitimacy—and necessity—of audits to flush out cheats and instill tax obedience, Mendoza said the agency’s finite energy should not be wasted on going after small businessmen.
For them, it’s go big or go home.
