26/11/2025
Eto pala ang dahilan kung bakit issue na naman ngayon ang BIR.
The abuse of the Letter of Authority (LOA) by some personnel within the Philippines' Bureau of Internal Revenue (BIR) typically involves using the document as a tool for corruption, harassment, and demanding bribes from taxpayers.
Instead of being used strictly for legitimate audits based on valid selection criteria, the LOA can be weaponized through various practices:
Extortion and Bribery: The most common form of abuse involves revenue officers using the threat of a prolonged or severe audit to extort money from taxpayers, often offering to "fix" the company's tax obligations in exchange for an unrecorded cash payment.
Repeated or Unjustified Audits: Some businesses face repeated, even yearly, audits without a clear, valid reason for suspicion of wrongdoing. This creates an environment of fear and pressure, making taxpayers more susceptible to illegal demands.
Procedural Missteps: Abuses can also involve procedural violations that render the audit or subsequent assessment invalid. Examples include:
Improper Signatures or Erasures: Issuing LOAs that are not properly signed by the authorized regional director or commissioner, or contain erasures.
Unauthorized Personnel: Allowing revenue officers not specifically named in the LOA to continue an audit, which is a violation of due process and can void an assessment.
Lack of Due Process: Failing to properly issue or serve Preliminary Assessment Notices (PAN) to the taxpayer's authorized representatives, a critical step in the assessment process.
"Fishing Expeditions": In some cases, LOAs may be issued without a solid, pre-defined audit program or specific criteria, essentially launching a "fishing expedition" through a taxpayer's records in the hope of finding discrepancies, rather than verifying a specific concern.
Creating Uncertainty: Inconsistent audit practices in general contribute to a climate of uncertainty for businesses, which can be exploited by corrupt officials.
These issues have been acknowledged by high-ranking officials, leading to calls for reform and recent actions such as the temporary suspension of all field audits and related operations by the BIR to review existing policies and protect taxpayers from potential abuse. Taxpayers who believe they are being subjected to illegal acts by BIR personnel are encouraged to report such activities to the authorities or challenge procedurally defective LOAs through formal legal channels.
