Sen. Cynthia Villar calls on the Social Security System to run after delinquent employers. Bayan Muna party-list representative Neri Colmenares notes that during the 2009 Senate proceedings for the approval of the SSS Condonation Law, SSS was found to have failed to collect a total of P94 billion from employers (Talk of the Town, 9/6/15 and 10/4/15). Sen. Grace Poe suggests that SSS only needs to achieve effective collection of membership obligation. And Leyte Rep. Ferdinand M. Romualdez says that SSS failed to collect P13 billion from delinquent employers as of 2014, and SSS filed only an average of 1,200 cases per year (“LP bets fear voters’ backlash over SSS pension veto,” News, 1/16/16). In 2010 alone, there were 164,111 delinquent employers.
The Social Security Act has this taxing provision: “The contributions payable under this act in cases where an employer refuses or neglects to pay the same shall be collected by the SSS in the same manner as taxes are made collectible under the National Internal Revenue Code…” In other words, to ensure funds needed to dispense benefits at the time needed, social security contributions are treated as taxes, and the assessment and collection of unpaid social security contributions from employers shall be done “in the BIR manner.”
“In the BIR manner,” the assessment and collection of taxes are made summary and purely administrative in nature to make for speed and promptness—i.e., without delay, without hindrance, without interference, without impediment, nonlitigious, technical defenses cut off, without need of judicial proceedings, etc. This “awesome power” of the Bureau of Internal Revenue can be stopped if the law is not observed because the power to tax is not unlimited.
But since 1957, SSS assessments and collections of unpaid social security contributions from employers have not been “in the BIR manner” but “in the SSS manner.” To illustrate this point, let me cite a few examples.
In the BIR manner, assessments can be based on best evidence/information available; whereas the SSS assessments have to be based on primary/original evidence as prescribed by the strict rules in judicial proceedings. BIR assessments have administrative finality and conclusiveness; whereas SSS assessments are by “turn-around” demand notices/letters and therefore have no administrative finality and conclusiveness. In the BIR, the burden is on the taxpayers to submit all relevant evidence to rebut presumptive assessments; in the SSS, the burden is on the SSS—from accessing workers’ and employment records to the filing of criminal actions to collect, to requesting the issuance of subpoena duces tecum, etc.
As to collection, this the BIR can do at the administrative level, by levy and distraint, without hearings and a judgment; whereas the SSS can do so only after hearings and a judgment.
In the BIR, assessment has a limitation of three to 10 years and collection five to 10 years; whereas the SSS has no prescriptive period for assessment, while its limitation for filing an action for collection is up to 20 years, extendible by 10 years provided the 10-year period under the Civil Code has not yet expired.
—JUAN MARIANO DESCALZO JR., former manager of SSS NCR, Culiat, Tandang Sora Avenue, Quezon City