THE funds collected through the motor vehicle users’ charge (MVUC), popularly known as road users' tax, is "underutilized," a government think tank said Wednesday.
A study conducted by the Philippine Institute for Development Studies (PIDS) showed the failure to fully utilize the collections was due to the lack of a definitive operating procedure system on how to identify and prioritize projects.
The authors of the study—PIDS Consultants Sheilah Napalang and Pia May Agatep, PIDS Senior Research Fellow Adoracion Navarro, and Research Associate Keith Detros—underscored that the processes of identification, approval, and implementation of proposed projects are problematic.
"Project identification does not follow the prescribed procedures. The approach is bottom up, rather than top down, [thereby] failing to incorporate a network perspective of accident blackspots, and leading to projects that are not of the highest priority being approved and implemented," the authors explained.
The MVUC, which is imposed through the registration fees of vehicles and penalties for overloading and collected by the Land Transportation Office (LTO), is envisioned as a new source of funding to finance road maintenance and minimize air pollution. MVUC is considered the third biggest source of tax revenue for the government, contributing an additional 40 percent of available funds for maintenance of national roads.
According to Republic Act (RA) 8794, funds collected from the MVUC should be placed in four special accounts in the National Treasury: Special Road Support Fund (80%), Special Local Road Fund (5%), Special Vehicle Pollution Control Fund (7.5%) and Special Road Safety Fund (7.5 %). The tax forms the bulk of the annual motor vehicle registration.
The PIDS study pointed out that project approval and fund release under the Special Local Road Fund requires the prerogative of the city mayor, leaving the process open to politicking.
“Project implementation is, ideally, a coordinated effort among several government agencies and the Road Board. However, in reality, there is evidently a real potential of overlaps of functions, especially between the DPWH and the Road Board Secretariat,” the authors added.
They also cited the lack of transparency, given the absence of a clear schedule for proposal submission and approval of the projects. They maintained that this setup leaves the process open to political interference.
Aside from underutilization, the study also enumerated potential sources of discrepancy in fund collection, such as for the funds deposited as General Fund, due to incorrect agency and transaction codes and the lack of a list of deposited collections.
To solve these problems, the PIDS study recommended that MVUC collection be automated to efficiently track collections and deposits. (SDR/Sunnex)