Tax evasion charges amounting to a staggering P2.5.5 billion were filed by the Bureau of Internal Revenue yesterday before the Department of Justice against four “ghost” corporations which were caught in possession of thousands of fictitious receipts allegedly being sold to various business establishments and individual taxpayers resulting to big revenue losses for the government in the past three years.

BIR Commissioner Romeo Lumagui Jr. yesterday said the agency is now hot on the trail of the individual taxpayers and businesses who were using the fictitious receipts and vowed that the agency would also file charges against them soon.

Lumagui said, “We have a list of both buyers and sellers of these fictitious receipts. Our main goal here is to put these fraudulent activities into a halt with the hope of increasing voluntary tax compliance.”

Fictitious receipts

He said the fictitious receipts were being used by businesses as corresponding deductions in their expenses and value-added tax.

The BIR chief added the said corporations have been operating for more than three years already.

Charged before the DoJ were Buildforce Trading Inc., Crazykitchen Foodtrade Corp., Decarich Supertrade Inc., and Redington Corporation and their officers.

They will undergo preliminary investigation for violation of Sections 254 (Attempt to Evade or Defeat Tax), 255 (Failure to File Return, Supply Correct and Accurate Information, Pay Tax Withhold and Remit Tax and Refund Excess Taxes Withheld on Compensation), and 267 (Declaration Under Penalties of Injury) of the National Internal Revenue Code of 1997 (Tax Code).

Under Section 254, an attempt to evade or defeat tax is punishable by a fine not less than P30,000 but not more than P100,000 and imprisonment of not less than two years but not more than four years.
Lumagui expressed belief that there are other groups operating as a syndicate  that are engaged in selling fictitious receipts.

He said the illegal scheme has been in place for a long time and there are other groups possibly involved, thus they will also be launching  “Run After Fake Transactions” operations to stop the selling of fictitious receipts of the so-called ghost corporations.

Condominium raid

Last December 2022 the BIR conducted a raid led by Lumagui himself with the BIR legal and revenue officers at a condominium unit in Quezon resulting to the filing of the case against the four erring companies.

Lumagui said the operation resulted to the seizure of thousands of fictitious receipts.

He further said that the said corporations  do not have any legitimate business activity and that they were established only for the purpose of selling fictitious sales invoices and/or receipts to their buyers for the latter’s claim of false and anomalous purchases.

“As a result of these companies’ fraudulent tax schemes, the government lost an estimated total deficiency income tax amounting to P17.63 billion and total deficiency value added tax amounting to P7.91 billion, for taxable years 2019-2021, inclusive of surcharges and interests,” Lumagui said.