Gatchalian to BIR: Intensify efforts vs. use of fake, ghost receipts

The Bureau of Internal Revenue must intensify its efforts to "eliminate the proliferation" of ghost and fake receipts, said Senator Win Gatchalian on Saturday.

The senator noted that the acts of using ghost and fake receipts are "denting government revenues and adversely affecting micro-enterprises."

Gatchalian explained that ghost receipts are those being issued amid the non-existence of actual sales or there are fictitious underlying transactions.

The fake receipts, on the other hand, are those being issued but not duly authorized by the BIR as they are meant to understate the sales.

BIR Commissioner Romeo Lumagui Jr. earlier said the estimated total value of ghost receipts issued has already reached P1.3 trillion.

Based on the income tax and value-added tax rates of 25 percent and 12 percent, respectively, the government has lost at least P370 billion in revenues due to the issuance of ghost receipts by various businesses.

Gatchalian stressed, "this is a serious issue."

"We are talking about a trillion peso-worth of fraudulent receipts going around the system, and it's affecting not only government collection but also taxpayers who are doing honest business," he added.

"They bought something but they were issued fake receipts. As a result, they can't claim their input VAT because it was disapproved by the BIR," Gatchalian further noted.

Meanwhile, the BIR reported that it has already filed criminal cases against the buyers and sellers of ghost receipts.

Despite the ongoing BIR efforts, Gatchalian emphasized the need to further intensify the campaign "to improve government revenue collection and protect small businesses" that fall prey to sellers of ghost receipts or enterprises that issue fake receipts.

Earlier in June, BIR filed criminal cases against buyers of ghost receipts that led to revenue loss amounting to P17.9 billion, with cases also filed in March against four "ghost" corporations—that cost the government about P25.5 billion in revenue loss.

Gatchalian acknowledged the challenging part of proving the buyer's innocence when transactions involved large sums of money, noting that it is usually being performed with banks and similar financial institutions.

"I just want to flag to the BIR that these things are happening and we are getting some information about them. Just submit to us a report on what the agency is doing in fighting ghost receipts and these types of fake receipts," he told the BIR officials in a recent public hearing.