Organization and Functions of the Enforcement Service Including the Divisions Under It Down to Section Level

August 7, 2000 REVENUE ADMINISTRATIVE ORDER NO. 03-00 SUBJECT : Organization and Functions of the Enforcement Service Including the Divisions Under It Down to Section Level TO : All Internal Revenue Officers and Others Concerned I. OBJECTIVE: This Order defines the organization and functions of the Enforcement Service including its divisions and sections pursuant to Executive Order No. 175 dated November 3, 1999 on Organizational Restructuring of the Bureau of Internal Revenue to Improve Administrative Control over Certain Categories of Taxpayers. II. ORGANIZATION: The Enforcement Service shall be under the direct supervision of the Commissioner. It shall be headed by an Assistant Commissioner and shall be composed of the following divisions with their respective sections: A. Tax Fraud Division 1. Intelligence Section 2. Investigation Section B. Policy Cases Division 1. Audit Section I 2. Audit Section II III. FUNCTIONS: ENFORCEMENT SERVICE shall: 1. Perform staff, advisory and consultative functions relative to the investigation of tax fraud and policy cases and intelligence operations; 2. Develop and administer policies, work programs, standards, guidelines and procedures relative to the abovementioned functions; 3. Provide policy guidance and operational directions to all divisions under the Service relative to the abovementioned functions; 4. Perform functions relative to tax fraud investigation and intelligence operations; 5. Identify vital third party information needed by the Enforcement Service and request such information from Assessment Service; 6. Conduct audit of policy cases and prepare audit manuals as a result of the policy cases investigation; 7. Review reports of investigation of tax fraud and policy cases and submit them for final review and approval to the Office of the Commissioner; 8. Prepare and issue pre-assessment notices, letters of demand or assessment notices for duly approved reports of investigation; 9. Resolve protests and requests for reinvestigation/reconsideration whether or not the protest is in accordance with the provisions of Section 228 of the National Internal Revenue Code (NIRC), as amended, and its implementing regulations; or whether or not the protest involve a question of fact or of law or both; 10. Prepare BIR Form 40.00; 11. Prepare Authority to Cancel Assessment (ATCA); 12. Issue Termination Letter signed by the Commissioner; 13. Summon, examine and take testimony of persons pursuant to Sec. 5 of the NIRC of 1997 and other applicable laws and regulations; 14. Conduct surveillance on persons identified and suspected to be involved in activities in violation of NIRC and other pertinent laws and regulations, in coordination with the Regional Offices concerned; 15. Perform liaison activities with other intelligence, police and investigative agencies for the conduct of arrests, raids and seizures on cases referred/approved by the Commissioner; 16. Coordinate with proper offices in the implementation of the abovementioned functions; 17. Monitor, evaluate and improve programs and activities under the responsibility of the Service; 18. Review, recommend and/or approve all reports and other actions of the divisions under the Service; 19. Consolidate and/or prepare prescribed reports for submission to the offices concerned; and 20. Perform such other related functions as may be assigned. A. Tax Fraud Division shall: 1. Formulate policies, work programs, standards, guidelines and procedures on the investigation of tax fraud cases and the conduct of intelligence work; 2. Investigate tax fraud cases referred and/or approved by the Commissioner and those developed by the Division; 3. Identify vital third party information needed by the Division and request such information from Assessment Service; 4. Summon, examine and take testimony of persons pursuant to Sec. 5 of the NIRC of 1997 and other applicable laws and regulations; 5. Interpret intelligence information relating to tax fraud matters from all available sources; 6. Coordinate and integrate all intelligence activities of Regional Offices; 7. Maintain systematic records of all cases handled by the Division; 8. Prepare and recommend manuals on methods and techniques of investigating tax fraud cases; 9. Coordinate with the proper offices in the implementation of the abovementioned functions; 10. Prepare prescribed reports for submission to the offices concerned; 11. Prepare revenue issuances relative to the abovementioned functions; and 12. Perform such other related functions as may be assigned. 1. Intelligence Section shall: 1.1. Set up policies, work programs, standards, guidelines and procedures relative to the conduct of intelligence work; 1.2. Assist the Investigation Section by drawing up an effective intelligence operations; 1.3. Identify vital third party information needed and request such information from Assessment Service; 1.4. Summon, examine and take testimony of persons pursuant to Sec. 5 of the NIRC of 1997 and other applicable laws and regulations; 1.5. Conduct surveillance on persons identified and suspected to be involved in activities in violation of the NIRC as amended to establish prima facie case on the basis of a tax assessment pursuant to Sec. 5 of the NIRC of 1997; 1.6. Consolidate and interpret intelligence information relating to tax fraud matters from all available sources; 1.7. Conduct liaison activities with other intelligence, police and investigative agencies for the conduct of arrests, raids and seizures in cases referred/approved by the Commissioner; 1.8. Coordinate with the Special Investigation Division concerned all intelligence operations including those on activities pertaining to smuggling, syndicated crimes and the use of fake BIR accountable forms; 1.9. Supervise the safekeeping of confidential documents of the division and control all data and communications received pertinent to cases handled; and 1.10. Perform such other related functions as may be assigned. 2. Investigation Section shall: 2.1. Set up policies, work programs, standards, guidelines and procedures relative to the conduct of investigation of tax fraud cases; 2.2. Prepare specific plans in the conduct of tax fraud investigations of suspected criminal violators of internal revenue laws and regulations in coordination with the Intelligence Section; 2.3. Investigate tax fraud cases as may be referred and/or approved by the Commissioner and those developed by the Division; 2.4. Plan, organize and conduct inventory taking and surveillance work in order to establish a prima facie fraud case on the basis of a tax assessment pursuant to Section 5 of the NIRC of 1997, upon mission orders issued; 2.5. Maintain systematic records of tax fraud cases handled by the Section; and 2.6. Perform such other related functions as may be assigned. B. Policy Cases Division shall: 1. Formulate policies, work programs, standards, guidelines and procedures relative to the investigation of policy cases; 2. Conduct audit of policy cases and prepare audit manuals as a result of the policy cases investigation; 3. Process/audit all claims for tax credit and/or refunds of policy cases except those processed by the Legal Service and prepare corresponding Tax Credit Certificate/Voucher; 4. Establish and maintain records of cases handled by the Division; 5. Coordinate with the proper offices in the implementation of the abovementioned functions; 6. Prepare prescribed reports for submission to the offices concerned; 7. Prepare revenue issuances relative to the abovementioned functions; and 8. Perform such other related functions as may be assigned. The Sections (Audit Sections I and II) of be Policy Cases Division shall perform identical functions enumerated above. IV. REPEALING CLAUSE: All issuances or portions thereof not consistent with the provisions of this Order are hereby repealed or amended accordingly. V. EFFECTIVITY: This Order shall take effect immediately. (SGD.) DAKILA B. FONACIER Commissioner of Internal Revenue Approved: (SGD.) JOSE T. PARDO Secretary of Finance