Bulacan flood contractor faces tax evasion case
Mendoza said ghost projects were a natural starting point for investigation since liability was easier to establish — tax returns declaring project costs could be checked against any actual work.
Daily TribuneMendoza said ghost projects were a natural starting point for investigation since liability was easier to establish — tax returns declaring project costs could be checked against any actual work.
The Bureau of Internal Revenue (BIR) has filed a tax evasion complaint against a flood control contractor over an alleged ghost project in Bulacan.
BIR Commissioner Charlito Martin Mendoza filed the case on Thursday before the Department of Justice (DoJ) against Mark Allan Arevalo, sole proprietor of Wawao Builders, for an alleged tax deficiency of at least ₱P48 million.
According to Mendoza, Arevalo was awarded a river infrastructure protection project in Bulacan in 2024 and he received payment but no actual construction was carried out.
“He received the money, but no flood control project was actually built. It was a ghost project,” Mendoza said.
Despite this, Arevalo reportedly claimed construction-related costs and operating expenses in his tax returns. The BIR found these deductions to be fictitious, forming the basis for the tax evasion complaint.
The agency said the case is part of the government’s broader effort to fight corruption in public infrastructure projects, following President Ferdinand Marcos Jr.’s directive to prioritize investigations involving government spending.
Mendoza said ghost projects were a natural starting point for investigation since liability was easier to establish — tax returns declaring project costs could be checked against any actual work. But he emphasized that the BIR is also probing completed projects that may involve substandard work or inflated costs, which could also signal tax violations.
The DoJ will conduct a preliminary investigation, with the BIR ready to submit additional pleadings once the respondents file their counter-affidavits.
This is the third tax evasion complaint filed by the BIR involving infrastructure projects, with a combined alleged tax liability approaching ₱P9 billion. Mendoza said that at least four more cases may be filed as investigations continue, including ongoing probes of politicians and local officials linked to alleged ghost projects.
“All individuals involved are under investigation,” Mendoza said, adding that the BIR is ensuring that every case is backed by clear and sufficient evidence before filing.