Complaints from foreign diplomats and international business groups over the Bureau of Internal Revenue‘s use of letters of authority have reached the Senate, Senator JV Ejercito said in a statement before the chamber.
He reported that ambassadors and members of American and European chambers have raised concerns about alleged abusive enforcement practices tied to the issuance of LOAs. “Marami na rin pong sumbong sa kanila lalo na’t ang mga ambassador at mga miyembro ng American European chambers ang may umangal na laban sa mga LOA ng BIR,” he said, adding that the situation has become embarrassing for the country.
Ejercito said the concerns relayed by foreign chambers mirror the accounts of local taxpayers who have reported repeated and aggressive issuance of LOAs. Several businesses told his office they received multiple LOAs within a short period, while others said assessment amounts shifted dramatically depending on whether they agreed to off-the-book settlements. In these cases, only a portion of the negotiated payment was issued an official receipt.
He also cited stories of inflated or unsupported assessments that led taxpayers to negotiate out of fear of further scrutiny. “Hindi upang maresolba ang tax deficiency, kundi upang masigurado ang halaga na mapunta sa kanila,” he said, describing how some negotiations were allegedly structured to benefit personnel rather than enforce lawful compliance.
Ejercito said these practices contribute to a climate of fear among business owners who hesitate to report misconduct due to concerns they will be targeted further. He warned that such patterns undermine investor confidence and damage the country’s reputation among foreign communities that expect predictable and fair tax administration.
The senator urged the committee to examine the allegations closely, saying the reports point to systemic issues in revenue enforcement. He called for safeguards to ensure letters of authority serve their proper function as audit tools rather than instruments of coercion. “We have to stop this culture of corruption that is now plaguing this country,” he said.
