Recto tax amnesty proposal seen providing relief while DoF grapples with audit abuses

THE FEDERATION of Philippine Industries (FPI) said a tax amnesty floated by the previous secretary of the Department of Finance (DoF) could be a good starting point as the department grapples with the issue of revenue officers abusing their authority when inspecting taxpayers’ books.

FPI President John Reinier H. Dizon said former Finance Secretary Ralph G. Recto had proposed the tax amnesty earlier this year. Shortly after he left the department, his successor, Secretary Frederick D. Go, presided over the suspension of field audits in response to instances of alleged extortion by Bureau of Internal Revenue (BIR) examiners.

“I do not know the status of (the amnesty) but I think that is a good starting point because some companies struggle with documentation,” he told reporters on the sidelines of the BusinessWorld Forecast 2026.

“An amnesty program to restart the entire thing is also maybe interesting for many businesses and companies,” he added, referring to the reform of the Letter of Authority (LoA)system, the document which the BIR issues when assigning revenue officers to examine taxpayers’ books

In August, Mr. Recto floated a new general tax amnesty, which will also include the extension of the estate tax amnesty.

On Wednesday, the House Ways and Means Committee approved an unnumbered substitute bill which consolidated five measures seeking to extend estate tax amnesty to Dec. 31, 2028.

Under the bill, heirs of individuals who died on or before Dec. 31, 2024, will be eligible to avail of the estate tax amnesty.

Meanwhile, similar bills were filed in the Senate and are awaiting committee disposition.

Separately, the European Chamber of Commerce of the Philippines (ECCP) said it welcomes the suspension of the field audits, including the system of issuing LoAs and mission orders to revenue officers.

“This measure reflects the administration’s commitment to good governance, as well as its responsiveness to long-standing concerns from the business community regarding predictability, transparency, consistency, and integrity in the tax audit process,” it said in a statement Thursday.

The ECCP also expressed its willingness to work with the newly created technical working group and provide industry insights and expertise.

“We are confident that these reforms will contribute to an audit system that protects taxpayer rights while enabling the BIR to meet its revenue objectives through fair and transparent processes,” it added. — Justine Irish D. Tabile