The Bureau of Internal Revenue has long been involved with the Study Group on Asian Tax Administration and Research (SGATAR). This organization of tax administrators in the Asia-Pacific region has for its objectives the dissemination of relevant information and the exchange of ideas and experiences among tax administrators and policy formulators in the Asia-Pacific region.
It was the Philippine delegation to the Ministerial Conference for Economic Developments of Southeast Asia in 1970 that initiated the formation of SGATAR. The first SGATAR meeting was held in Manila in 1971. Eight countries comprised the original group of member-states in the SGATAR. Currently, there are 18 members including Australia, Cambodia, People’s Republic of China, Chinese Taipei, Hong Kong SAR, Indonesia, Japan, Lao People’s Democratic Republic, Macao SAR, Malaysia, Mongolia, New Zealand, Papua New Guinea, Philippines, Republic of Korea, Singapore, Thailand, and Vietnam. These countries hold annual meetings and take turns in hosting them.
The Philippines was the host in November 2017, with the BIR holding the meeting in Boracay. I attended several of these SGATAR meetings in other countries when I was with the BIR, including the one in Malaysia in 1982, where I presented the Philippine paper on “Current Cost Accounting: A Study of Tax Implications and the Revenue Effects of a Change from Historical Cost to Current Cost System.”
The SGATAR is now focused on six priority areas. These are Base Erosion and Profit Sharing, Multinational Enterprise Risk, Information sharing, Taxpayer service, Tax Transparency and Small-Medium Enterprises Compliance. I observe that the outputs of the SGATAR in these areas pale in comparison when compared to the results of similar international institutions such as the Organization for Economic Cooperation and Development (OECD), International Monetary Fund (IMF), and others.
Through the years, the SGATAR has done several research works and published a number of tax books. However, these are few and far in between, with the last research project completed in 1993, and the last book published in 2002.
In 2002, the SGATAR established the Joint Training Programs and biennial Meetings of Heads of Training Institutions. These initiatives had objectives of developing Capacity Building Programs for enhancing tax administration among SGATAR members with the support of the OECD and the Asian Development Bank. There have not been too many developments in this area with training programs participated by the tax officers of the member countries being conducted infrequently.
The SGATAR has been in existence for over 50 years. I note that this has not had the desired impact it can have. The SGATAR has not been able to pursue effective long-term and sustainable projects and initiatives that can greatly benefit its member countries or the global or regional tax community.
One reason for this is that the leadership of SGATAR is given to the host country, which changes every year. With these annual changes of leadership, it is difficult to have continuing programs over the years. As far as I know, SGATAR does not even have a permanent Secretariat that can provide administrative and archiving support to the organization. I recall that during the early years of SGATAR, the National Tax Research Center (NTRC), with executive Director Angel Yoingo, performed this secretariat function. NTRC has long ceased discharging this support, and SGATAR does not have any secretariat group to date.
Since the Philippines was instrumental in the formation and growth of the SGATAR, it can, through the BIR, pursue a more active leadership involvement in the SGATAR. The BIR can advocate to the member states of the SGATAR for measures that can provide more sustainable undertakings of a more administrative-effective SGATAR. These can include the creation of a permanent secretariat and even a project management team for the organization. The BIR, in cooperation with the NTRC and the Philippine Tax Academy, can provide support to the SGATAR’s projects, such as competency training, research, and publications. The NTRC can again be tapped to provide secretariat functions, with financial support coming from the member states, such as Japan, Australia, Korea, and China. The financial assistance can also fund the hiring of a project management team that will move forward the various initiatives of the SGATAR. All these efforts will cause the SGATAR to become a more vibrant and effective organization pursuing important tax initiatives.
It is just proper that the Philippines, which initiated the creation of SGATAR, will proceed in taking this leadership role in this global tax organization.
To be continued
Joel L. Tan-Torres was the former Dean of the University of the Philippines Virata School of Business. Previously, he was the Commissioner of the Bureau of Internal Revenue, the chairman of the Professional Regulatory Board of Accountancy, and Tax partner of Reyes Tacandong & Co. and the SyCip Gorres and Velayo & Co. He is a Certified Public Accountant who garnered No. 1 in the CPA Board Examination of May 1979. He is now back to his tax and consultancy practice and can be contacted at firstname.lastname@example.org and his firm JL2T Consultancy.