Reconstitution of the Review Committee Created under Revenue Memorandum Order No. 32-73 dated August 31, 1973 to Review Dockets of Accounts Receivable Exceeding P20,000.00 for More Definitive Disposition thereof

July 30, 1975 REVENUE MEMORANDUM ORDER NO. 45-75 SUBJECT : Reconstitution of the Review Committee Created under Revenue Memorandum Order No. 32-73 dated August 31, 1973 to Review Dockets of Accounts Receivable Exceeding P20,000.00 for More Definitive Disposition thereof TO : All Internal Revenue Officers and Others Concerned In view of the re-assignments of the members of the Review Committee and its Working Group created under Revenue Memorandum Order No. 32-73 dated August 31, 1973, and as a result of the re-organization under P.D. No. 640, the said Review Committee is hereby re-organized and the following procedures for the review, re-evaluation and taking of definitive actions concerning cases or dockets of accounts receivable in excess of P20,000.00 (national accounts) are hereby promulgated for the compliance of all concerned. I. REVIEW COMMITTEE A. The Review Committee is hereby reorganized to be composed of the following: Bernardo Carpio Chairman Assistant Commissioner (Operations) Honorio Todio Vice-Chairman Revenue Service Chief (Collection) Priscilla R. Gonzales Member Revenue Service Chief (Legal) Leonardo L. Cabaero Member Revenue Service Chief (Assessment) Eufracio Santos Member Tax Amnesty Implementation Officer B. The Review Committee, through its Chairman, as reconstituted above, shall: 1. On the basis of the List of Delinquent Accounts, B.I.R. Report Form No. 40.00 and other records of the Receivable Accounts Division, immediately cause the inventory listing of all the dockets of the abovementioned delinquent accounts, including the retrieval of all such dockets which may have been charged to the individual members of the old Review Committee and its Working Group as well as those pending dockets which are now in the possession of other officials or units of organization of the National Office. cdt 2. Exercise control and disposition of pertinent dockets and records through the Chief, Receivable Accounts Division and the Chief, Collection Enforcement Division, depending upon the stage of collection enforcement under Republic Act No. 5203, both of whom shall remain to be the repository and custodian of such active dockets and records, and who shall progressively charge to and turn over said dockets and records to the Review Committee Chairman, upon request of the latter or members of the said Committee and its Working Group. C. The Review Committee, acting as a Body, shall exercise and perform the following authority and responsibility: 1. Review and evaluate the facts and the law involved in each case as determined by the assigned member/s of the Working Group, and recommend the approval/disapproval or otherwise amend the action recommended by said member/s of the Working Group. The committee's decision, by unanimity or majority, shall be elevated for the approval/disapproval of the Commissioner thru the Deputy Commissioner. 2. Upon approval by the Commissioner or by the Deputy Commissioner in case he is so authorized, of its recommendation/s, the Committee shall take such further appropriate action, or cause the preparation of such appropriate action by the units of organization concerned, as shall be necessary towards the final disposition of the collection cases handled by it under this project. 3. Adopt such supplementary procedures and forms, requisition supplies, and request for the assignment or the assistance of office or field personnel as are necessary for the implementation of this project. II. WORKING GROUP A. To assist the Review Committee, the old Working Group, is hereby reconstituted to be composed of the following members: 1. Ladislao Jimenez Manufacturing Division 2. Pedro Yadao Financing, Real Estate & Transfer Taxes Division 3. Roberto Ocampo Agric. & Nat. Resources Division 4. Alejo Sibayan Financing, Real Estate & Transfer Taxes Division 5. Inocencio Saldaa Financing, Real Estate & Transfer Taxes Division 6. Benjamin Golez International Operation Division 7. Beethoven Rualo Direct Taxes Division 8. Francisco Viray Agric. & Natural Resources Division B. The members of the Working Group shall perform their functions and responsibilities in accordance with the following procedures: 1. The members shall work individually, or as a group, as may be required by the Committee Chairman. 2. Each member shall review the facts and law involved in each case assigned to him by the Committee Chairman, and determine whether the assessment/s thereon can stand scrutiny in court or not, or even if in the affirmative, the chances of collecting the whole amount due are dimmed by reason of circumstances other than the merits of the case; 3. Such determination shall be set forth in a Memorandum of recommendation, which should be as concise as possible, attaching thereto such working tools and forms as the Committee may devise such as statement of adjustment, work sheets, financial analysis, etc.; 4. Whenever necessary to facilitate collection and/or final termination of a case, informal conferences with taxpayer and/or representative shall be conducted by the member/s assigned to the case in consultation with the Chairman of the Committee. III. GUIDELINES The following and other special instructions from the Commissioner in the exercise of his authority to compromise cases under Section 309 of the Internal Revenue Code shall be observed as guidelines by the Committee and the Working Group: A. Cases that can stand scrutiny in court without attendant circumstance/s that could negate or diminish prospects of collection . The finality of the assessment should be ascertained and if it has not been established in accordance with the decision of the Supreme Court in several cases, a follow-up letter should be prepared advising the tax-payer of the finality of said assessment/s, and at the same time giving the taxpayer a last chance to settle the case by the payment of an amount which shall be at least 50% of the total tax liability/ies, including increments and penalties, as the Review Committee shall recommend to the Commissioner and the Deputy Commissioner, taking into account all material circumstances relative to the prospects of immediate collection of the reduced amount of the liability. However, the reduction should always be subject to the condition what, failure to pay immediately shall be construed as abandonment of the privilege and immediate collection of the total liability/ies without any deduction, will be enforced thru the remedies provided for by law. B. Other cases characterized by, or suffering from, any one or more of certain defects or circumstances which could materially affect the prospects of collection by means of court action and/or summary remedies . These cases may be settled and closed by the payment of an equivalent sum falling within the range of the following minimum and maximum percentages of the assessment/s, i.e. the total taxes due plus updated increments and penalties: Settlement Acceptable Bases on Total Amount Due _______________ 1. Where taxpayer is in- solvent or otherwise suffering from financial distress 15-30% 2. Where the corporate taxpayer has dissolved and no successor-in-interest has been ascertained or is ascertainable, except the board of directors and other officials who continue to remain liable under existing jurisprudence 10-30% 3. Where evidence is insufficient or hard to obtain 10-20% 4. Where taxpayer's property is outside the territorial jurisdiction of the country 10-25% 5. Where collection enforcement would be difficult because of prior adverse claims on taxpayer's assets 10-30% 6. Where the assessment/s are of doubtful validity 15-30% 7. Where the interest of the government is best served by avoiding long, tedious and costly litigation 15-40% C. Cases not failing clearly under any of the classification hereinabove, shall, likewise, be considered by the Review Committee, which shall determine and recommend to the Commissioner the amount acceptable as settlement of each case. D. Cases where the right to assess or collect has clearly prescribed, or where the taxpayer is already dead and verified to have left no property, or where the taxpayer is missing and efforts towards locating his whereabouts have consistently failed, should be cancelled and the appropriate ATCA issued by the Review Committee for approval of the Commissioner and Deputy Commissioner. E. The Trial Attorneys, Hearing and Legal Officers of the Litigation, Appellate, Prosecution and Law Divisions of the Legal Service are considered members of the Working Group with respect to cases assigned to them which cases may fall within the classifications set forth hereinabove. The member/s of the Review Committee and of the Working Group, representing the Legal Service shall take such necessary steps that will facilitate the consideration and action of these cases. F. The expeditious collection and closing of cases on delinquent accounts with due regard to the protection of both the rights of the government and the taxpayer should be the overriding concern and objective of those charged with the implementation of this project. IV. The members of the Review Committee, the Working Group and others who will be charged with the execution of this project may delegate to their respective subordinates their duties and functions, in order that they can devote ample time, effort and attention to the successful implementation hereof. V. ROUTING All actions and recommendations by members of the Working Group, including those of the Legal Service in accordance with their assignment in paragraph letter "E" hereinabove, shall be submitted direct to the Chairman of the Review Committee. The action/decision/recommendation of the Review Committee shall be submitted to the Commissioner thru the Deputy Commissioner. VI. This Order supersedes Revenue Memorandum Order No. 32-73 dated August 31, 1973 and shall take effect immediately. MISAEL P. VERA Commissioner of Internal Revenue TAN 1601-593-5