President Ferdinand R. Marcos Jr. has ordered the abolition of the Department of Finance’s One-Stop-Shop Inter-Agency Tax Credit and Duty Drawback Center (OSS Center) in line with the administration’s rightsizing policy.
Under Administrative Order No. 4 which was signed by Executive Secretary Lucas Bersamin on February 20, 2023 and released on Wednesday, the OSS Center’s functions of processing and issuing tax clearance certificates (TCCs) and duty drawbacks will be transferred to the Bureau of Internal Revenue (BIR) and Bureau of Customs (BOC), respectively.
“All other assets and liabilities of the OSS Center shall be transferred to the Department of Finance (DOF) in accordance with pertinent auditing laws, rules and regulations except all cash separately held in trust or otherwise by the OSS Center, which shall be directly remitted to the National Treasury,” AO No. 4 said.
It was DOF Secretary Benjamin Diokno who recommended to President Ferdinand R. Marcos Jr. the abolition of the OSS Center for two main reasons.
“First, some OSS Center officials and employees have been found to have committed a series of several tax credit scams involving billions of pesos over the years,” Diokno said.
“Second, its abolition and transfer of functions under the BIR and the BOC are in line with the Marcos Jr. administration’s push to right size government. This will streamline revenue operations and reduce administrative expenses,” Diokno added.
Diokno also pointed out that the OSS Center has not processed and issued any tax credit certificates since 2016. “It is not practical for the government to provide for its budget every year since it does not perform its functions anymore,” he said.
AO No. 4 provides that OSS Center personnel who would be affected by the move will “receive separation benefits…unless they are appointed to other positions in the government.”
The OSS Center, which is under the DOF, had been created under Administrative Order No. 266 for the orderly and expeditious processing of tax credits and duty drawbacks under various laws.
AO No. 4 took note that “there is a continuing need for institutional strengthening and promotion of the economy, efficiency and effectiveness in the delivery of public service across all the executive departments and offices, consistent with the rightsizing of the Administration, including the rationalization of functions and activities carried out by the public sector.”
“[It] is the policy of the National Government to rationalize the functional structures of agencies with complementary mandates and promote coordination efficiency and organization coherence in the bureaucracy,” the AO said.