Philippines Threshold Program

The $21 million Philippines Threshold Program focuses on addressing improved revenue administration and anti-corruption efforts and is consistent with the “Medium-Term Philippine Development Plan, 2004-2010,” which was announced by President Gloria Macapagal-Arroyo in October 2004. With support for its anti-corruption initiatives, the Government of the Philippines will further accelerate the pace of sustainable and continuous efforts to stamp out corruption, plug revenue leaks, increase tax collection and ultimately channel more resources to poverty reduction programs such as in healthcare, education and social services.

The Philippines Threshold Program will reduce corruption by strengthening the Office of the Ombudsman and strengthening enforcement within three areas of the Department of Finance (DOF)—the Revenue Integrity Protection Service (RIPS), the Bureau of Internal Revenue (BIR) and the Bureau of Customs (BOC).

Implementing Partners

The U.S. Agency for International Development will take the lead in implementation, working closely with MCC. Other U.S. agencies may also be involved.

To address corruption, the DOF is simultaneously conducting anti-corruption drives in three separate areas: the DOF itself through its RIPS unit, the BIR through its Run After Tax Evaders (RATE) unit, and the BOC through its Run After The Smugglers! (RATS) unit. All three units were recently organized and given increased resources to increase the government’s enforcement ability. Additional resources are needed to train staff and provide the equipment and systems to increase their effectiveness. The aim of this component is to improve the ability of the RIPS, RATE and RATS units to expose violators and increase compliance with the laws by both taxpayers and officials of the revenue collection agencies.

The Ombudsman has the authority to investigate and prosecute high-level government officials in its own courts. Funding has increased significantly for the office, resulting in dramatic increases in staff and requirements for additional training and equipment in order to be effective. The goal of this activity will be to reduce opportunities for corruption throughout the government by training Ombudsman employees and establishing information management and investigation and surveillance capability. The component also aims to reduce the deficit by reducing the cost of government operations and by obtaining higher revenues as revenue collection officials develop a stronger incentive to be honest.

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