Tax reforms to boost investor confidence – FFCCCII

MANILA, Philippines —  The Federation of Filipino-Chinese Chambers of Commerce and Industry Inc. (FFCCCII) yesterday expressed support for reforms in the Bureau of Internal Revenue (BIR)’s conduct of audits, noting these would help strengthen investor confidence.

In a statement, FFCCCII president Victor Lim expressed confidence in reforms announced by Finance Secretary Frederick Go in the conduct of BIR audits following the move to suspend the issuance of letters of authority (LOAs) in November last year.

On Friday, Go said the BIR is looking at a digitized, risk-based and data-driven audit system to strengthen accountability and prevent arbitrary and abusive audits.

When audits resume, Go said the aim is to reduce the offices authorized to issue LOAs and the number of LOAs a taxpayer can receive in a year.

The government suspended the issuance of the LOAs last year amid complaints of abuse in the audit system.

LOAs give the BIR authority to examine taxpayers’ books.

“By anchoring the audit process to a digitized, risk-based, data-driven system, the policy minimizes discretion, strengthens accountability and definitively curtails the potential for arbitrary measures,” Lim said.

He said the reduction of both the number of offices authorized to issue LOAs and the number a taxpayer may receive in a year also provides predictability, transparency and fairness.

“Such a principled framework will fuel investor and business confidence,” he said.

For FFCCCII, progressive policies such as these are needed to encourage both domestic and foreign investments for sustained Philippine economic growth.