Senate opens probe on alleged 'weaponization' of letters of authority

The Senate Blue Ribbon Committee on Thursday opened its probe into the alleged money-making scheme within the Bureau of Internal Revenue (BIR) involving the issuance of Letters of Authority (LOA).

In his opening speech, Senator Erwin Tulfo slammed the alleged misuse and weaponization of LOAs and mission orders (MOs) of some BIR personnel, citing complaints from small businesses and international companies.

"For years, small and big businesses have raised serious concerns, many claimed they were subjected not to fair tax assessment but to pressure, intimidation, and questionable demands in exchange of withdrawal or softening of tax investigations," Tulfo said.

"Kahit mga international companies, hindi ninyo pinatawad pinatos na ninyo (Even international companies were not spared)... Let me be clear the purpose of LOAs and MOs is to ensure the taxes owed to the government are collected properly, transparently, and lawfully. Hindi ito dapat gamitin na sandata ng pananakot o instrumento ng corruption (It should not be weaponized as an instrument of corruption.)," added Tulfo.

According to the senator, the alleged money-making scheme entails BIR personnel submitting only 25% of the collected taxes from the LOAs and MOs.

"If these complaints were true, then we're looking into systemic abuse that harms not only individual tax payers also the nation's business climate and international reputation. Kapag nawalan ng tiwala ang negosyo -- local man or foreign --  nawawala ang trabaho. Nawawala ang kita at oportunidad para sa aitng mga kababayan (If businesses lose trust, we will also lose jobs as well the Filipino's livelihood and opportunities.)," Tulfo added.

Among those who attended the Senate hearing were Finance Secretary Frederick Go, BIR Commissioner Charlito Mendoza, former BIR Commissioner Romeo Lumagui, Jr.,  and ex-BIR Commissioner Kim Henares.

Last month, Tulfo delivered a privilege speech to call out the alleged misuse and abuse of LOAs and MOs.

This prompted the BIR to order the immediate suspension of all field audits and related operations, including the issuance of LOAs and MOs amid complaints by some businessmen and taxpayers.

Malacañang also said it intends to launch an investigation into the alleged scheme within the BIR. —VAL, GMA Integrated News