By Jelly F. Musico
MANILA, March 25 (PNA) – The Bureau of Internal Revenue (BIR) has found an ally from Sen. Sergio Osmena III on its call to lift the bank secrecy law to allow the government agency to check the bank records of suspected tax evaders.
”I have always been in favor of lifting it but I could never pass it here,” Osmena said.
Osmena, chairman of the Senate committee on banks, financial institutions and currencies, allayed fears by some of his fellow senators who claimed the BIR’s proposal would have chilling effect in the banking industry.
”It will not discourage bank depositors. There are certain limits to bank secrecy laws all over the world,” Osmena said.
In the United States, Osmena said the Internal Revenue Service (IRS) can open a bank account without the owner knowing it upon the approval of the court.
”They have to go to a judge and the judge will ask, ‘what’s you reason for opening the bank account of Sergio?’ Because he’s got a Ferrari and his income is only 2,000 dollars a month, so how can he own it?,” Osmena explained.
”Before I know it, somebody is knocking at my door and told me, ‘Mr. Osmeña, can we invite you to a meeting, we would just like to know, if you only make $ 24,000 a year, how did you afford a $ 120,000 Ferrari?’ Then I will respond, my mother gave it to me. Ah, okay,” he added.
Osmena said lifting the Bank Secrecy Law will definitely help the BIR in running after the tax cheaters.
The veteran senator said any move to lift the Bank Secrecy Law should be approved first at the House of Representatives.
”They have to pass it in the House first. Because if we will pass it here in the Senate and nothing will happen in the House, that will be a waste of time,” he said.
Osmena said the bank secrecy is ‘sacrosanct’ in the country.
”The Anti-Money Laundering Council? They took away the power to lift the bank secrecy. And this is the strongest bank secrecy act in the whole world. That was 1954 (law),” he said.
Last Monday, Sen. Grace Poe said the banking industry should be consulted on the BIR’s proposal as it may affect the economy due to “capital flight.”
“The matter should be studied. The banking industry should be consulted. The public might lose faith in the banks if their accounts are made open to scrutiny by the BIR,” Poe said.
Sen. Francis Escudero, chairman of the Senate committee on finance, said the proposal “might be too much.”
Sen. Nancy Binay expressed worry that the proposal might be used to commit crime or for political harassment.
”Can the BIR guarantee that the information will be for lawful purposes and will not be used to commit crime or for political harassment?” Binay asked.
Sen. Juan Edgardo Angara, for his part, supports the BIR’s proposal but also warned for possible capital flight and loss of confidence in the banking industry. (PNA)