NEARLY four weeks before the deadline of filing of tax returns, Bureau of Internal Revenue (BIR) Commissioner Romeo D. Lumagui Jr. has officially declared war against all those who profit in propagating a culture of tax evasion using “ghost receipts.”
“The war is officially designated as the ‘Run After Fake Transactions’ (RAFT) program of the BIR,” a statement from the Commissioner’s office read. “Its base of operations is the Office of the Commissioner, the program being the brainchild of Lumagui himself.”
The statement said the program “is the first of its kind in the history of the BIR.” The program stems from the issuance of Revenue Memorandum Circular (RMC) 38-2023, containing the priority programs and projects of the BIR for this year, the agency’s statement read.
The BIR defines “ghost receipts” as “fictitious receipts/invoices where transactions did not take place.”
“Its main purpose is to reduce the income tax and VAT [value-added tax] liabilities of the purchaser by claiming false deductions/expenses and claiming input VAT on the basis of fictitious transaction, ultimately resulting to defrauding the government of taxes.”
The BIR said its “war against ghost receipts” will be made on three fronts: buyers; sellers; and, certified public accountants (CPAs).
Hauled to jails
ACCORDING to the BIR, it will audit buyers of ghost receipts and revoke the license of a CPA “for abetting and advising their clients to avail of a tax evasion scheme.” The agency said it will seek imprisonment for six years to ten years for buyers, sellers and CPAs charged with tax evasion.
“This is an all-out war. All available BIR forces will be deployed, this is the top priority program for our enforcement activities,” the Commissioner emphasized.
Lumagui said this is his “last warning” as the April 17 deadline for the filing of tax returns nears.
“In the coming April 17 deadline, this is my last warning to all buyers of ghost or fictitious receipts. Do not use the same in your tax filings. Do not listen to your CPAs or financial advisors telling you to evade your taxes through ghost receipts.”
The BIR chief said his office has a list of buyers and sellers of ghost receipts.
“Your business will be tagged and audited. You will spend more due to this audit, in comparison to just paying the proper taxes. You, your company officers and financial advisors will be imprisoned for tax evasion. Not only will you lose millions of pesos, you will also lose your freedom,” Lumagui said “in his ultimatum to the taxpaying public.”
File, pay anywhere
IN a separate statement, Lumagui said he has authorized the filing and payment of the 2022 Annual Income Tax Return (AITR) anywhere, through RMC 32-2023. The RMC provides that taxpayers can now file their 2022 AITR and pay the corresponding taxes due thereon anywhere on or before April 17, 2023, without penalties imposed for wrong venue filing, according to the BIR.
“I wanted to improve the services that we offer to the taxpaying public. My ultimate goal here is to provide each one of us the luxury of filing and paying our correct taxes at our most convenient time and place without any penalties involved. I am encouraging everyone, avoid the rush! File and pay as early as now before the April 17 deadline,” Lumagui was quoted in the statement as saying.
According to the BIR, taxpayers who are mandated to use the agency’s electronic filing and payment system, or “eFPS,” shall file their AITRs electronically and pay the correct taxes due through the eFPS-Authorized Agent Banks (AABs) where they are enrolled.
“Thus, in cases wherein filing cannot be made through the eFPS, due to specific reasons mentioned in the RMC, taxpayers shall use the eBIRForms in filing their AITR. Hence, the tax returns filed through the latter shall no longer be required to be filed [through] the eFPS.”
ON the other hand, the payment of taxes due for the electronically-filed returns through the eBIRForms may be made through any AABs; Revenue Collection Officers (RCOs) in each Revenue District Offices (RDOs) or through the different Electronic Payment (ePayment) channels of the BIR.
These ePayment Channels accept tax payments through the use of either online, credit/debit/prepaid cards and mobile payments such as GCash, Maya & MyEG.
Link to the ePayment channels is accessible in the BIR website. Likewise, each payment gateways have provided instructional videos to taxpayers, particularly the step-by-step procedures in making their online tax payments so that they can easily navigate the electronic platform they opt to use in paying their taxes.
It is also underscored in the RMC that, “No Payment AITRs” shall also be filed electronically.
Taxpayers with “No Payment AITRs” are allowed to manually file their 2022 AITR, provided that they qualify in any of the following conditions set by the Commissioner himself:
n Senior Citizen (SC) or Persons with Disabilities (PWDs) filing for their own returns;
n Employees deriving purely compensation income from two or more employers, concurrently or successively at any time during the taxable year, or from a single employer, although the income of which has been correctly subjected to withholding tax, but whose spouse is not entitled to substituted filing; and,
n Employees qualified for substituted filing (those who are covered by Section 2.83.4 of Revenue Regulations No. 2-98, as amended), but opted to file for an ITR and are filing for purposes of promotion, loans, scholarships, foreign travel requirements, etc.
TAXPAYERS who qualified under the manual filing of their “No Payment AITRs,” shall prepare the tax returns in triplicate copies using the electronic or computer-generated returns or photocopied returns in its original format in legal-size and/or folio-size bond paper.
Furthermore, the RMC also reminds taxpayers who will manually file AITR and pay taxes due thereon through RCOs of the RDO to pay in cash up to P20,000 only or in check (payable to “Bureau of Internal Revenue”).
As to the submission of the required attachments, Lumagui highly advised those who electronically filed their AITRs to utilize the Bureau’s Electronic Audited Financial Statement (eAFS) System in submitting the required attachments. They are also given the option to personally submit it to the large taxpayer service (LTS) office and/or RDO where they are registered within 15 days from the date of the tax filing deadline.
Meanwhile, for taxpayers who electronically filed their AITRs but there are no attachments required, printed copy of the e-filed tax returns need not to be submitted to the BIR. The generated “filing reference number” from eFPS or the email confirmation from eBIRForms will serve as proof of the electronically filed AITRs.
Lumagui emphasized that only the attachments will be stamped received by the LTS/RDO and the printed copy of AITR need not be stamped “Received.”
LUMAGUI also reminds the public not to use “ghost receipts” in their filings. He urges the public to scrutinize “the unlawful schemes their CPAs might use in illegally lessening their taxes.”
He cited that a CPA involved in these receipts will suffer both the revocation of their license and imprisonment. The Commissioner has already filed an administrative case for revocation of a CPA’s license last March 21 and a criminal case for tax evasion against the same CPA last March 16.
The filing of cases against this unnamed CPA came after a raid of a condominium unit in Quezon City last December, which, the BIR said, contained thousands of “ghost receipts.” The BIR said Lumagui filed criminal cases before the Department of Justice against the sellers of these ghost receipts last March 16.
Lumagui said these are just one of the examples of the top agenda for his administration, which is “aggressive and fearless enforcement activities.”
The BIR said the Commissioner also led a nationwide raid against illegal cigarettes last January. There will be a nationwide filing of criminal cases against the traders involved in the coming months, Lumagui vowed.
He also led a raid against big warehouses where illegal vape traders are storing their untaxed and unregistered merchandise in November last year. Cases worth P1.2 billion and criminal cases were filed against these traders last December, according to the BIR.
Regular enforcement against illegal cigarettes and vape will also continue, the agency said.