A compelling argument is resurfacing within financial circles: a fundamental restructuring of the nation’s revenue collection system. A former high-ranking Finance department official believes the time is ripe to revisit a bold proposal – consolidating the Bureau of Internal Revenue (BIR) and the Bureau of Customs (BoC) into a single, powerful National Revenue Authority (NRA).
The call for reform stems from persistent challenges in maximizing revenue collection. Cielo Magno, former Undersecretary of Finance, highlighted ongoing issues that necessitate a serious re-evaluation of the current system, suggesting the NRA concept deserves renewed consideration.
The idea isn’t new. Back in 2017, a House Bill proposed by a former President aimed to dismantle the existing structure and streamline tax collection processes. This earlier attempt sought to address inherent inefficiencies and complexities within the BIR and BoC.
Recent controversies have further fueled the debate. The BIR faced criticism regarding the handling of audit authorizations, while the BoC encountered complaints from international businesses citing intrusive inspections and questionable fees. These incidents underscore a lack of consistent, transparent practices.
Economic headwinds have compounded the problem. Both the BIR and BoC fell short of their 2025 revenue targets, a shortfall attributed to a slowing economy and recent scandals involving corruption and import restrictions. This missed revenue impacts critical government programs and infrastructure projects.
A leading voice advocating for radical change is Raymond Abrea, CEO of the Asian Consulting Group. He proposes not just consolidation, but complete abolition of the existing bureaus, replaced by a professionally managed NRA operating with the autonomy of a government-owned corporation.
Abrea envisions an NRA shielded from political influence, allowing for objective and efficient revenue collection. This structure, he argues, aligns with the constitutional mandate for government control over revenue while fostering a performance-driven culture.
He points to the Inland Revenue Authority of Singapore as a successful model, demonstrating how an independent, well-managed revenue agency can significantly boost collection rates. This success hinges on attracting top talent and embracing cutting-edge technology.
The proposed NRA would leverage digital platforms, artificial intelligence, and blockchain technology to fully automate tax and customs administration. This modernization would not only improve efficiency but also reduce opportunities for corruption and human error.
The government currently projects collecting nearly P4.82 trillion in revenue for 2026, with the BIR contributing the bulk at P3.431 trillion and the BoC adding P1.003 trillion. The potential for increased revenue through a reformed system is substantial.
Despite repeated attempts to solicit comment, the Department of Finance, along with the Commissioners of both the BIR and BoC, remained unavailable for immediate response. This silence adds to the growing sense that a critical conversation is being avoided.
