Ejercito flags alleged taxpayer harassment through BIR LOAs

Senator JV Ejercito has raised concerns over alleged harassment of taxpayers by the Bureau of Internal Revenue (BIR), particularly through the use of Letters of Authority (LOA).

In a DZBB radio interview, Ejercito said that almost all the business owners he has spoken to “umaangal at umaaray sila dahil naha-harass sila ng BIR through the LOA, na ginagamit bilang kasangkapan for extortion.”

Ejercito warned that such practices are discouraging foreign investors and placing undue pressure on small businesses. “Hirap na hirap na nga tayo kumuha ng foreign investment, tapos ‘yung mga nandito, gusto nang umalis kung ganito ang polisiya ng BIR,” he said.

He also pointed to ongoing government inefficiencies, referencing the flood control scandal and alleged overreach in tax collection. “’Yung 70% na dinadakma, kakapiranggot ang ipinapasok sa gobyerno… Nakakaawa ang mga maliliit na negosyante at ordinaryong taxpayers.”

Yesterday, newly appointed Finance Secretary Frederick Go addressed these concerns in a radio interview. He announced the suspension of Mission Orders (MO) and Letters of Authority to allow a comprehensive review of BIR policies and procedures.

“Kakaupo ko lang po sa pwesto last week, at isa sa mga unang tinignan po namin ay kinausap ko po si Bureau of Internal Revenue Commissioner Charlie Mendoza,” Go said.

Go explained that inspections should only occur when there is probable cause. “Dapat meron kang probable cause bago ka pwedeng pumasok. Hindi naman puwede po na wala kayong probable cause, basta lang papasok kayo at guguluhin ang taxpayer. Wala naman po kayong ebidensya o probable cause para gawin ang lahat ng actions na ito,” he said.

The Mission Order allows limited inspections or surveillance, while the LOA grants the BIR authority to thoroughly examine company books and documents, similar to a search warrant.

Go emphasized that taxpayers must comply with lawful LOAs but warned against enforcement without proper evidence. “That’s why we really need a comprehensive review of the policies and procedures nitong mga Letters of Authority,” he added.