14/12/2025
For many businesses, the letter from the Bureau of Internal Revenue (BIR) can inspire anxiety rather than reassurance. Letters of Authority (LoA), designed to ensure taxpayers pay what they owe, are now under scrutiny for potential misuse.
Former BIR Commissioner Kim Jacinto-Henares explains that while LoAs are neutral tools, without proper controls they can be abused. The recent suspension of audits and freeze on issuing LoAs and Mission Orders comes as a move to protect honest taxpayers.
Business groups like the American Chamber of Commerce of the Philippines (AmCham) and the Makati Business Club welcome the pause. They see it as a chance to shift attention toward reforms, including the National Single Window system, which promises streamlined trade approvals and reduced discretionary audits.
Experts note that audits are not just for revenueโthey act as a deterrent to incorrect tax filings. Even if they make up only 3โ5% of total collections, audits encourage compliance and fairness. Transparency and consistent guidance are key to building trust among investors and businesses alike.
In a country where businesses drive national development, ensuring that tax inspections are fair, predictable, and transparent is more than policyโitโs a step toward lasting trust, growth, and shared prosperity.
๐ผ Our view on this reflection is based on the citation in the comment below
Aubrey Rose A. Inosante, โEx-commissioner acknowledges potential for BIRโs LoA to be abused,โ BusinessWorld, November 26, 2025
