Collection of Delinquent Accounts

November 20, 1967 REVENUE MEMORANDUM ORDER NO. 78-67 SUBJECT : Collection of Delinquent Accounts The alarming large number of delinquent accounts in the books of the Bureau of Internal Revenue has always been a nagging problem. Many campaigns have been launched to reduce at least the delinquent accounts to a comfortable minimum but these efforts were always thwarted by a number of factors. cdta The many disasters specially typhoons that have befallen the country for the last few months will have a great effect on the taxes that we expect to collect. To rely on the usual course in the payment of taxes, this Office will not be able to collect the estimated collection goals that have been set. The only source that we can tap now to increase collections is the delinquent tax accounts. It may be stated that revenue personnel were recently granted 50% salary increases based on RA 4900; this would therefore give incentive to revenue personnel to work harder. There would be no reason therefore why this campaign cannot be a success. If our collection goals are realized this year, the next 50% salary increase will surely be given. Revenue Regions 6, 7, and 8 are given special attention in this campaign because about eighty per cent (80%) of all uncollected accounts are in these regions. For the purpose of establishing a special program and set of procedures relative to the collection of delinquent accounts in Revenue Region Nos. 6, 7 and 8; of setting up policy guidelines relating to said campaign; of pinpointing objectives; and of defining, fixing and re-stating responsibilities, so as to reduce delinquent accounts to the minimum by removing from the list accounts which have been settled and by convincing or compelling taxpayers to settle accounts still outstanding, this Order is issued. I . POLICY STATEMENTS A. Performance in this delinquent accounts campaign of all revenue officials and employees shall be used as one of the main factors in the assignment, reassignment or advancement of the personnel concerned. The record of such performance will be a part of their personnel file and shall be used for rating performance. B. During the campaign, applications for leaves of absences by employees or fieldmen assigned to the campaign will be subject to approval by the Deputy Commissioner of Internal Revenue. A fieldman reporting for duty after a vacation or sick leave will not be issued letters of authority to investigate, unless he completes his work quota on delinquent accounts. C. No letters of authority to investigate will be issued to a fieldman unless he was completed work on the quota of delinquent accounts assigned to him. D. The service or execution of WDL or the use of other summary remedies shall not be suspended or stopped except in highly meritorious cases. E. All office audit personnel in the assessment branches shall devote at least one half day of every working day during the campaign to perform office collection work. F. Action on protested cases must be expedited at all operational levels. G. Time tables will be given for each phase of the campaign and to each unit of organization involved. H. Revenue personnel assigned to undertake ordinary or special enforcement collection work in connection with this campaign shall not be limited to the jurisdictional areas of their respective regions or districts. When necessary taxpayers will be contacted outside the region or district where his delinquent accounts is listed. cdtech II . SCOPE This campaign shall involve the collection of taxes listed in the delinquent account list as of July 1, 1967. It shall cover a period of 3 months (Nov. 21, 1967 to February 20, 1968). The campaign shall be conducted in 4 phases: 1. Updating of the delinquent accounts list to identify and eliminate accounts which are already paid. 2. Office collection work on amounts that can be settled through the use of the telephone or letters. 3. Actual field collection work by revenue personnel. 4. Maintenance of the system so as to preclude recurrence of the problem. III . RESPONSIBILITIES A. Revenue Operations Head (Collection) The Revenue Operations Head (Collection) shall be: 1) Responsible for the over-all supervision and coordination of all activities relative to the campaign and shall exercise technical supervision over all field component units and personnel involved in the campaign. 2) Provide leadership over and administer the campaign. B. Revenue Operations Head (Management Planning) The Revenue Operations Head (Management Planning) shall: 1) Be responsible for developing procedures and controls and for maintaining continuous evaluation of national and field office performance. 2) Cause verification of accounts reported as paid. 3) Set aside sufficient funds to support the expenses that this campaign will incur. C. National Task Force on Collection To act as the action and implementing arm of the Collection Department, there is created a National Task Force on Collection, with the following functions: 1) Direct and coordinate the nation-wide total and relentless effort to collect and reduce the number of delinquent accounts. 2) In coordination with the Management Planning Department and the Project Coordinators Group, continue work relative to the development of improved plans and procedures. 3) Establish procedures for coordination and control. 4) Evaluate and improve existing procedures. 5) Assist the Collection Department in the preparation and submittal of required progress reports. 6) Act decisively on problems relating to the campaign or refer the same to the official concerned. 7) Perform trouble-shooting work. 8) Constantly review and evaluate performance of component units and personnel involved. 9) Submit recommendations to the Commissioner of Internal Revenue requiring action or policy decision. 10) Check up and conduct follow-up of the performance of personnel involved in the campaign. The members of the task force shall be designated by special order. This Task Force shall be directly responsible to the Revenue Operations Head (Collection). D. Performance Evaluation Team To act as the management control arm of the Revenue Operations Head (Management Planning), a Performance Evaluation Team is hereby created, with the following functions: aisadc 1) Make constant evaluation of the performance of any unit or personnel involved. 2) Undertake selective verification of tax cases where taxpayers' whereabouts are reportedly unknown or of any such action or report which fail to close a tax account. 3) Follow-up and report on any significant action, decision or development affecting or involving the campaign. 4) Gather and develop data (statistical or otherwise) relating to the campaign. 5) Submit independent progress report. E. National Special Enforcement Team To act as the collection enforcement arm of the National Task Force on Collection, there is hereby created a National Special Enforcement Team, with the following functions: 1) Full nation-wide responsibility for the execution of WDLs, and the seizure, levying, garnishment, and sale of properties concerning delinquent accounts involving P100,000.00 or above each. 2) Coordinate with the Tax Accounts Division, Legal Department, regional offices, and other government enforcement agencies in the enforcement of actions against the above tax cases. 3) Submit fortnightly summary progress reports on its collection enforcement activities to the ROH (Collection). 4) In coordination with the Regional Director concerned, effect immediate transfer or physical custody of all seized, garnished, or levied property or any symbolic or legal title thereto, pursuant to Revenue Memorandum Order No. 20-66. F. Tax Accounts Division 1) Inventory tax dockets under its custody. 2) Prepare and issue Warrants of Distraint and Levy based on the priorities to be established. 3) Prepare fortnightly reports on all division activities relative to this campaign. G. Data Processing Center 1) Prepare and send expeditiously to the region concerned Statement of Accounts corresponding to each delinquent account. 2) Call attention of any official concerned to inaccuracies or errors in input documents. 3) Refer to the National Task Force and the Performance Evaluation Team any significant problem or matter involving or affecting the collection campaign. 4) Send regularly to the Revenue Operations Head (Collection) a list of collection agents who have not submitted the required reports. H. Regional Directors (For RO-6, 7, & 8) The regional directors concerned are hereby directed to give their utmost attention and concern to the following duties and responsibilities: 1) Regional Directors are primarily responsible for the success of the campaign in their respective areas. Specifically: a) to collect the delinquent accounts in the region. b) to update and purify the lists and records relative to said delinquent accounts. 2) Personally direct and coordinate all activities relating to the campaign. 3) Mobilize personnel under his jurisdiction to insure the success of the campaign. 4) Act expeditiously and decisively on all matters or problems falling within his authority. 5) Refer without delay to the National Office all matters or problems relative to the campaign which fall outside of his authority or competence to act upon, and follow up actions or decision of the same. 6) Implement without delay all actions, decisions or orders emanating from the National Office. 7) Make constant on the spot evaluation and follow-up of the performance of all component units and personnel in his region. 8) Submit a fortnightly report on the progress and status of the campaign. 9) Recommend to the Commissioner of Internal Revenue for commendation or incentive award any outstanding performance of any personnel or component unit in his Region. 10) Recommend without delay to the Commissioner of Internal Revenue any disciplinary action against any personnel relative to the campaign. I. Project Coordinators Regional Advisory Team To assist and advise the Regional Director and the Chief, Collection Branch on all matters relative to the campaign, there is hereby attached to the Regional Office a team composed of two (2) project coordinators, which is hereby designated as Project Coordinators Regional Advisory Team, with the following functions: 1) Assist the Regional Director and the Chief, Collection Branch relative to delinquent accounts collection campaign. 2) Assist in preparing the periodic progress and status reports. 3) Assist in making constant on the spot review and evaluation of the performance of component units, and personnel involved in the campaign, and in making report thereon to the Chief, Collection Branch or to the Regional Director. 4) Act as liaison and coordinating officer between the Regional Office and the National Task Force on Collections. 5) Function as action and follow-up team for the Regional Director and the National Task Force on Collection. 6) Refer immediately to the officials concerned, all significant matters or problems involving or affecting the campaign and follow-up action on the same. 7) Assist in implementing without delay all orders, decisions, or actions relating to the campaign. 8) Recommend to the Regional Director actions to be taken on personnel or procedural matters. 9) The Project Coordinators Regional Advisory Team shall discharge only staff advisory functions. LLphil J. Chief, Collection Branch 1) Exercise immediate supervision and control over all activities relative to the collection of delinquent accounts and the updating and correction of all lists and records relating to said delinquent accounts. 2) Set up a daily statistical chart on the progress and status of the campaign in the region. 3) Maintain efficiently the established controls and reporting system. 4) Inform the Regional Director immediately about any significant action, matter or decision. 5) Submit periodic reports to the Regional Director on the progress and status of the campaign. 6) Act decisively and expeditiously on any matter or problem relative to the campaign falling within its authority. 7) Refer to the Regional Director any matter or problem, relative to the campaign which falls outside of his authority or competence. 8) Maintain effective team work with the Project Coordinators Regional Advisory Team. K. Regional Special Enforcement Team Every Regional Director shall designate a Regional Special Enforcement Team composed of seizure agents and related personnel. The following shall be the team's functions: 1) Assume responsibility for all collection enforcement actions within the region against tax cases, except those involving P100,000.00 or above. The Regional Special Enforcement Team may be authorized by the Regional Director to assist the National Special Enforcement Team in enforcement work, upon request of the latter. 2) Coordinate its function with the Tax Accounts Division, Legal Department, the assessment, legal, and administrative branches in the region concerned, and with the other government enforcement agencies. 3) Submit fortnightly progress report on its collection enforcement activities to the Regional Director, thru the Chief, Collection Branch. 4) Report immediately to the Chief, Collection Branch, any significant action, decision, problem or development involving or affecting its collection enforcement work. 5) Actions and responsibilities with respect to seized, levied or garnished property arising from collection enforcement work shall conform to policies and procedures established by Revenue Memorandum Order 20-66. L. Revenue District Officers 1) Assume full responsibility for the performance of collection and assessment personnel under him, assigned to perform office or field collection work. 2) Submit required reports to offices concerned. 3) Act expeditiously or decisively on any matter or problem falling within his authority. 4) Refer immediately to the Regional Director any matter or problem involving or affecting Operations Delinquent Accounts, not falling within his authority to decide. 5) Maintain statistical charts on performance progress and status, insofar as the participation of his district is concerned. 6) Maintain the controls and reporting system relative to the campaign. 7) Refer immediately to the Regional Director any disciplinary action due to be taken against any personnel under his authority. 8) Recommend to the Regional Director the commendation or giving incentive awards to any personnel under his authority, for outstanding performance. 9) Make instant on the spot evaluation and follow-up action on the performance of any component unit or personnel under him. M. Group Supervisors (Assessment Fieldmen) 1) Exercise immediate control and supervision over assessment personnel assigned under him to perform field collection work. 2) Submit to offices or units concerned the required reports. 3) Maintain individual records of performance of each fieldmen under him and submit reports thereof to the Office of the Revenue District Officer and the Chief, Collection Branch. Follow-up and make constant on-the-spot check on the performance and action of fieldmen under him. 4) Report immediately to the Revenue District Officer any significant matter or problem involving or affecting the campaign in his jurisdiction. 5) Act expeditiously on any matter or problem falling within his authority. 6) Refer to the Revenue District Officer, (copy furnished the Chief, Collection Branch), any matter or problem of importance not falling within his authority. 7) Recommend to the Revenue District Officer, disciplinary action against any personnel under him not discharging his responsibilities. 8) Recommend to the Revenue District Officer, for commendation or incentive award, any personnel giving outstanding performance relative to the campaign. IV . GENERAL CLAUSE A. Special units created in this Order shall exist and function only for the duration of the campaign, unless so specified in subsequent orders. B. Procedures and other orders shall be subsequently issued and shall form part of this general order. C. Any order or provisions of orders in conflict with this Order are hereby revoked or amended accordingly. liblex D. This Order shall take effect immediately. MISAEL P. VERA Commissioner of Internal Revenue