SENATOR Paolo Benigno ‘Bam’ Aquino IV is drawing a line in the sand for the country’s small business owners, demanding an end to the alleged abuse and “weaponization” of the Bureau of Internal Revenue’s (BIR) Letters of Authority (LOA).
Speaking at a Senate Blue Ribbon Committee hearing, Aquino — a long-time champion of Micro, Small, and Medium Enterprises (MSMEs) and author of the “Go Negosyo Act” — insisted on immediate reforms to dismantle corrupt practices that stifle entrepreneurship. According to the senator, while big corporations have legal teams, the crushing weight of the LOA issue falls hardest on the smallest players.
“Iyong maliliit na negosyante po, sila po ‘yung pinaka-natatakot kapag nilalapitan po sila... Sila po ‘yung pinakatakot na takot kapag merong nangongorap po sa kanila. Walang mapuntahan, walang mahingan ng tulong,” Aquino said.
A culture of fearAquino zeroed in on the pervasive anxiety felt by entrepreneurs facing questionable tax assessments. He highlighted that this isn’t an isolated issue, citing extensive feedback gathered from business chambers across the nation.
“Unang-una, let me premise by saying that in the previous campaign this year, sa lahat po ng naikutan ko, local chamber, Philippine Chamber, Chinese Chamber, ito man ay sa probinsiya o dito po sa siyudad, grabe po talaga ang complaints ng mga negosyante pagdating sa BIR at sa LOA,” Aquino said.
These words underscore a systemic problem where unwarranted or excessively high assessments are allegedly used to pressure businesses into settlements, creating a breeding ground for corruption.
Radical transparency
To combat the alleged racket, Aquino proposed a strategy of radical transparency and structural reform to BIR Commissioner Charlie Mendoza and Finance Secretary Frederick Go.
His primary suggestion is to make LOA data public in a controlled manner, allowing taxpayers to immediately verify if an audit notice is legitimate.
“That’s my intention. Kaya dapat kung ilabas sana. So people can check kung yung LOA ba ito ay talagang valid o hindi,” Aquino explained.Aquino also pushed to remove the power of individual Revenue District Offices (RDOs) to hand-pick audit targets. He advocated for a “truly random manual audit” or a technology-driven system. This would prevent arbitrary targeting and ensure that compliant taxpayers aren’t harassed with re-audits for several years without cause.
Securing commitments
The push for reform is already yielding results. The senator secured a commitment from both the BIR Commissioner and the DOF Secretary to coordinate with the Senate Committee in analyzing past LOA data. This analysis aims to detect red flags: patterns of harassment, repeated audits, and massive initial assessments that suspiciously drop upon settlement.Aquino also commended a new BIR policy requiring all LOAs to be approved by the Commissioner’s office, a move that centralizes accountability. Additionally, the BIR highlighted the creation of a special email channel for audit concerns, giving MSMEs a direct line to report irregularities.
For Aquino, this probe is about more than just tax code; it is about institutionalizing peace of mind for hardworking Filipinos.“Mahalaga po na pakiramdam nila ang mga ahensiya ng gobyerno nasa panig nila,” Aquino said.
