The President asked the Bureau of Internal Revenue (BIR) and Bureau of Customs (BoC) to impose harsher punishment on tax cheats and smugglers who rob the government of resources and weaken the local economy.

Mrs. Arroyo noted the there are several existing presidential decrees that consider smuggling and tax evasion as crimes of economic sabotage, punishable by life imprisonment.

Under the law governing economic sabotage, persons involved in evasion of tax payments could also face court martial proceedings, according to the President.

"This is one tool that you can use to reinforce the campaign against smuggling and tax evasion," she told Finance Secretary Margarito Teves, Customs Commissioner Napoleon Morales, and Revenue Deputy Commissioner Lilian Hefti during a televised roundtable discussion in Malacañang, two days after a huge anti-smuggling raid on 168 Mall, a popular shopping center in Divisoria, Manila.

The President praised anew the BIR and BoC for the "biggest anti-smuggling bust in the nation’s history" as part of the government intensified crackdown to boost national revenues and protect domestic industries.

At least 500 customs agents and police seized hundreds of millions’ worth of contraband and closed several stalls at the Divisoria mall last Thursday.

Arroyo also instructed Customs Commissioner Morales to impose heavier penalties on merchants engaged in unfair trade practices at the shopping center.

"The penalties should be higher so they will be forced to increase the prices of imported goods to protect domestic producers," she said, apparently trying to allay fears that competition from low- priced smuggled goods would hurt legitimate businesses.

She congratulated Teves and his entire revenue team for exceeding revenue targets by R9.1 billion in January and February. The BIR and BoC raised P136.9 billion in revenues in the past two months, up 21.1 percent from R113.1 billion in the same period last year.

With the higher revenue yield, Arroyo said the government could narrow the budget deficit and spend more on improving vital infrastructure and social services.

The President, meantime, admitted the government is unable to grant appeals of exporters for an intervention to moderate rapid appreciation of the peso against the dollar.

"Whether we like it or not to intervene to lessen the strength of the peso, we cannot because the government does not have that kind of power," she said in the same forum.

Arroyo said only the Bangko Sentral ng Pilipinas has the sole authority to intervene in the foreign exchange market.

"The Central Bank is independent from the national government and it is clear that Central Bank Governor (Amado) Tetangco said they would not intervene and instead allow the market forces to determine the peso," she said.

To alleviate plight of the exporters, the President ordered Finance Secretary Margarito Teves to urge government and private banks to lessen their "intermediation costs" to pass the lower interest rates to the businessmen.

"We need to continue lower our budget deficit to lower our interest rates," Teves said, adding that lower interest rates would mean lower cost of business for exporters.

Malacañang had earlier said it prefers a stronger peso because it means cheaper imports and lower payments for foreign currency debts. But several businessmen have called on the government to buy dollars to boost its international reserves and let the peso fall to help exporters recoup their losses.

The President has said the natural peso value should be less than R50 to a dollar and vowed to sustain fiscal reforms to secure credit upgrades.

Rogues’ gallery of alleged coup  plotters defended

Legal experts in the House yesterday defended the government’s decision to set up a rogues’ gallery of alleged coup plotters and bounty system, which they said had been a practice of law enforcement agencies here and abroad for so many years now.

House Majority Leader Prospero Nograles and Rep. Salacnib Baterina (Lakas, Ilocos Sur), vice chairman of the House Committee on Justice, said critics are overreacting by questioning the practice now just because one of the subjects is a former senator.

Baterina said the poster of fugitive former Sen. Gregorio "Gringo" Honasan and his bounty were merely meant to solicit the public’s help to find out his whereabouts and effect his resurfacing to face justice.

"Is Gringo above the law so that the practice acceptable for other mortals can’t be applied to him? As in past cases, the intention of our law enforcers in putting up a rogues’ gallery is to hasten the capture of fugitives so they can be brought to court and face their cases."

Baterina also disputed the position that the rogues’ gallery was in violation of the fugitives’ constitutional right of "presumption of innocence and privacy" as the solon explained the government is not declaring Honasan and the others guilty as charged without the benefit of a trial.

Nograles said the Philippine government has long published the photographs of fugitives and this proved helpful in their effort to track them down.

"When you are facing charges and you are in hiding it can be done to compel you to surface or to effect your capture," he said.