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Senators call for safeguards to bank secrecy easing

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SENATORS signaled caution on easing bank secrecy laws, one of the issues that led Malacañang to veto parts of Republic Act 11213 or the Tax Amnesty Law, noting that safeguards are needed to prevent the use of bank account inquiries to harass taxpayers.

Senator Sherwin T. Gatchalian said provisions to ease bank secrecy in a general tax amnesty program require “a balancing act” of the various interests because bank account probes could be used for harassment.

“We need to put safeguards in place just to make sure that the bank secrecy relaxation will only be used for identifying fraud or tax evasion. It’s a delicate balance,” he said in a phone interview on Tuesday.

“It’s true that when you apply for an amnesty, there should be a mechanism wherein people will not evade their taxes and one of the tools is to relax bank secrecy. But relaxing bank secrecy can also be used to extort, to harass, (so) we have to make sure that safeguards are there. We have to have balance. It’s a balancing act,” he added.

In his veto message on Feb. 14, Mr. Duterte noted that the objective of the amnesty program may not effectively be carried out due to the absence of provisions lifting bank secrecy, the automatic exchange of information with foreign tax authorities, and mechanisms to ensure the truthfulness of asset or net declarations in amnesty applications.

The President also called on Congress to pass another general tax amnesty bill that would include the safeguards the enrolled bill lacked. The Department of Finance (DoF) has said the bank secrecy provisions would allow the government to verify claims made by taxpayers in their amnesty applications.




Sen. Joel J. Villanueva, vice chair of the Senate committee on ways and means, said the veto message of the President was reasonable and expressed support for the inclusion of such safeguards if the measure is reintroduced in the 18th Congress.

“The rationale for the President’s veto on the general tax amnesty provisions is reasonable. We support the need to strengthen the exchange of information, the waiver of the bank secrecy law in fraud cases, and safeguards on the truthful declaration of assets and net worth,” he said in a text message.

“We will consider it when the bill is refiled in the 18th Congress,” he added.

Senate President Vicente C. Sotto III on Tuesday said there was a need for both the legislative and executive branches to agree on the parameters of the general tax amnesty proposal to prevent another veto.

“I think we should sit with the Executive department first and agree on the parameters so we do not waste time and effort, not to mention the money wasted on hearings and sessions that could have been spent for other agreeable legislation,” he told reporters in a mobile phone message.

Sen. Panfilo M. Lacson on Monday expressed support for the passage of a general tax amnesty bill in the 18th Congress with provisions requested by Mr. Duterte, but noted that lawmakers may be “wary” over the issue of relaxed bank secrecy.

House committee on ways and means chair Estrelita B. Suansing earlier expressed optimism that a general tax amnesty bill could be passed within the 17th Congress, while her Senate counterpart, Sen. Juan Edgardo M. Angara, has said the measure could be tackled in the next Congress, due to the lack of time left in the 17th Congress.

Congress is on its Feb. 9 to May 19 break for the May 13 midterm elections. It will resume session between May 20 and June 27 before the 17th Congress concludes. — Camille A. Aguinaldo