FAKE BIR Letter of Authority (LOA)
On January 2023, one of our ATC Students received a Letter of Authority (LOA) from the BIR for the calendar year 2020. However, in the same year 2023, he received another LOA but for a different taxable year 2021. This means that he has two (2) LOA to handle and comply with the BIR. Double kill!
During our conversation, he admitted that he “settled” his company’s LOA in the past years by bribing the Revenue Officers assigned to the BIR tax audit investigation. These Revenue Officers, based on his experience, were the ones asking to “settle” it to terminate the LOA as early as possible. Now, the BIR Revenue Officers come back every year to issue new LOA to his company and ask for a higher bribe.
Relative to the above case, in May 2023, the House of Representatives approved on the third and final reading a bill, House Bill No. 8144 or An Act Defining the Crime of Tax Racketeering, increasing the penalties for attempts to evade or defeat any tax imposed under the Tax Code, as amended. This includes, among others, distributing, acquiring, using, or aiding in the use of unauthorized, fake, or falsified Letters of Authority (LOA). Hence, the Congress of the Philippines recognized the fact of corrupt practices employed by some of the BIR Revenue Officials and/or Employees by issuing unauthorized, fake, or falsified LOA, which are being used to ask for bribes from ignorant taxpayers.
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Considering the fact of past bribe transactions of our ATC Student, the two (2) LOA issued to his company might be fake LOA to enrich the corrupt BIR Revenue Officials and/or Employees at the expense of taxpayers and our government. You have two options to stop immediately these corrupt practices, namely:
First, stop bribing the BIR Revenue examiners assigned to your company’s audit investigations and start complying with the LOA by submitting your company’s applicable books and records. In the event the BIR issues tax assessments, our Tax Code provides you with the legal rights of filing a protest to question or contest these assessments.
And second, write a Request Letter to the office of the Regional Director who signed and issued your LOA by requesting the authentication of the said LOA you have received. We recommend submitting a copy-furnish of this letter to the higher BIR authorities, including the office of the Commissioner of Internal Revenue and the Department of Finance Secretary. In this case, the office of the Regional Director will be forced to answer your questions on the validity of the LOA.
So, is your LOA fake or not?
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Learn more about BIR Tax Audit for MSMEs
If you want to learn more about handling your own BIR tax audit investigations, we would like to offer you our RWB Book BIR Tax Audit for MSMEs. It has actual BIR assessments from LOA to FDDA. This includes samples of actual protest letters, templates, and exclusive ATC online videos to explain and discuss the contents of the RWB Book. Kindly click the photo below to learn more about this RWB Book.
