Aquino urges gov’t to shield MSMEs from harassment, corruption

Senator Bam Aquino urged the government to intensify efforts to protect micro, small, and medium enterprises (MSMEs) from harassment and corruption, particularly abuses linked to the issuance of Letters of Authority (LOAs) and Mission Orders (MOs) by personnel of the Bureau of Internal Revenue (BIR).

During a Senate Blue Ribbon Committee hearing on the alleged misuse of LOAs, Aquino said MSMEs — representing 99 percent of all registered businesses in the country — are the most vulnerable to intimidation and unlawful assessments by erring tax officials.

Aquino said he has received numerous complaints from MSMEs and chambers of commerce nationwide involving BIR personnel allegedly using LOAs to extort money from business owners. He noted that many enterprises are reluctant to come forward due to fear of retaliation.

“Iyong maliliit na negosyante, sila iyong pinaka-natatakot kapag nilalapitan sila. Our micro and small enterprises. Feeling nila, walang mapuntahan, walang mahingan ng tulong,” he said.

The senator also flagged the possibility of fake LOAs circulating among businesses, saying some documents received by taxpayers do not appear in official BIR records.

He warned that such fraudulent orders may be issued by rogue insiders.

To prevent abuses, Aquino proposed several reforms, including the public release of all issued LOAs so businesses can independently verify their authenticity.

He said greater transparency would help deter harassment and expose irregularities.

Aquino further recommended an audit of several years’ worth of BIR data to determine whether specific taxpayers are repeatedly subjected to audits or consistently spared from scrutiny. He also suggested removing the authority of Revenue District Offices to independently select audit targets and shifting instead to a random audit system.

The senator acknowledged BIR Commissioner Charlie Mendoza’s recent directive requiring all LOAs to be approved by the commissioner, a move intended to improve oversight and curb irregular issuances.

Aquino is the author and principal sponsor of Republic Act 10644, or the Go Negosyo Act, which aims to support MSMEs through improved access to markets, financing, training, and streamlined business registration.