BIR files ₱25.5 billion tax cases vs. 'ghost' corporations

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BIR Commissioner Romeo D. Lumagui Jr.

Metro Manila (CNN Philippines, March 16) — The Bureau of Internal Revenue (BIR) has filed criminal complaints before the Department of Justice against four "ghost" corporations selling fictitious sales invoices and receipts, with an estimated total tax liability of ₱25.5 billion.

"We are just getting started. The financial magnitude of this syndicate issuing fictitious receipts is alarming," BIR Commissioner Romeo D. Lumagui Jr. said in a statement on Thursday. "They are profiting from businesses through convincing their clients to ghost our tax authority. I have set my marching orders to the BIR Legal Group to file criminal charges against the individuals behind these companies."

In December, Lumagui headed a raid at a condominium in Quezon City which led to the seizure of a large number of falsified receipts, invoices, and other business documents issued to various individuals and companies nationwide. In a statement issued in the same month, the BIR identified some of the recipients as "cannot be located taxpayers."

The buyers would then use the fake documents to cheat when it comes to paying taxes.

"Sa makatuwid, ang buwis na dapat napupunta sa gobyerno ay binubulsa nitong mga gumagawa ng pekeng resibo," explained Lumagui.

[Translation: Therefore, the taxes that should go to the government are instead being pocketed by those making the fake receipts.]

"As a result of these companies' fraudulent tax schemes, the government is losing an estimated total deficiency income tax amounting to ₱17.63 billion and total deficiency value added tax amounting to ₱7.91 billion, for taxable years 2019-2021, inclusive of surcharges and interests," said the BIR.

An investigation showed the ghost corporations did not have any legitimate businesses, but existed to sell fake receipts.

Lumagui added the buyers of the fake documents will also be audited.

"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 high hopes of increasing voluntary tax compliance," he added.