The Bureau of Internal Revenue (BIR) has announced a nationwide campaign against the sale and use of fake identification cards for persons with disabilities (PWDs), describing the practice as both a tax evasion scheme and a disrespectful act toward legitimate PWDs.
In a recent statement, BIR Commissioner Romeo Lumagui Jr. emphasized the agency’s commitment to addressing this issue, which has resulted in significant revenue losses for the government. “People who sell and use fake PWD IDs are not only committing tax evasion; they are also disrespecting legitimate and compliant PWDs,” Lumagui said. He further explained that the discounts provided to PWDs under the law are intended to improve their well-being and alleviate financial burdens, not to serve as a general discount card for the public.
Revenue Losses and Widespread Abuse
The BIR estimates that the fraudulent use of fake PWD IDs cost the government approximately ₱88.2 billion in revenue losses in 2023 alone. PWDs are entitled to a 20 percent discount and an exemption from value-added tax (VAT) on specific goods and services. These benefits are designed to enhance their quality of life and address their unique needs.
However, the system has been exploited by unscrupulous individuals using counterfeit IDs to avail of these benefits fraudulently. These fake IDs are reportedly being sold both on the streets and through online platforms, making them easily accessible to those looking to take advantage of the system.
Intensified Audits and Penalties
As part of its intensified crackdown, the BIR has directed its teams to conduct rigorous tax audits on businesses that report PWD-related transactions. Establishments are required by law to maintain detailed records of their sales to PWDs, including customer names, PWD ID numbers, stated disabilities, discount amounts, and VAT exemption details.
The BIR will scrutinize these records to verify the legitimacy of the PWD IDs. If discrepancies are found, including the use of fake PWD IDs, the agency will disallow the deductions claimed by the establishments. Additionally, businesses will face assessments for deficiency VAT, along with applicable penalties and interest.
Collaboration with Government Agencies
To bolster its enforcement efforts, the BIR is strengthening its collaboration with key government agencies, including the Department of Health (DOH) and the National Council on Disability Affairs (NCDA). These partnerships aim to enhance the verification process for PWD IDs and prevent the proliferation of fake cards.
“With the assistance of key government agencies, strengthening enforcement and improving the monitoring of PWD-related transactions can help minimize fraud, ensure that benefits reach legitimate PWDs, and protect the integrity of the government’s tax system,” the BIR said.
Protecting Legitimate PWDs
The BIR’s campaign seeks not only to recover lost revenues but also to protect the rights and privileges of legitimate PWDs. Commissioner Lumagui reiterated that the law intends to support PWDs by easing their financial burdens. “Expect the BIR to run after fake PWD ID sellers and users,” he warned.
This nationwide crackdown underscores the government’s commitment to curbing fraudulent practices and ensuring that the benefits intended for PWDs are not undermined. Through intensified audits and inter-agency collaboration, the BIR aims to restore the integrity of the system and uphold fairness in the distribution of PWD benefits. The Bureau of Internal Revenue (BIR) has announced a nationwide campaign against the sale and use of fake identification cards for persons with disabilities (PWDs), describing the practice as both a tax evasion scheme and a disrespectful act toward legitimate PWDs.
In a recent statement, BIR Commissioner Romeo Lumagui Jr. emphasized the agency’s commitment to addressing this issue, which has resulted in significant revenue losses for the government. “People who sell and use fake PWD IDs are not only committing tax evasion; they are also disrespecting legitimate and compliant PWDs,” Lumagui said. He further explained that the discounts provided to PWDs under the law are intended to improve their well-being and alleviate financial burdens, not to serve as a general discount card for the public.
Revenue Losses and Widespread Abuse
The BIR estimates that the fraudulent use of fake PWD IDs cost the government approximately ₱88.2 billion in revenue losses in 2023 alone. PWDs are entitled to a 20 percent discount and an exemption from value-added tax (VAT) on specific goods and services. These benefits are designed to enhance their quality of life and address their unique needs.
However, the system has been exploited by unscrupulous individuals using counterfeit IDs to avail of these benefits fraudulently. These fake IDs are reportedly being sold both on the streets and through online platforms, making them easily accessible to those looking to take advantage of the system.
Intensified Audits and Penalties
As part of its intensified crackdown, the BIR has directed its teams to conduct rigorous tax audits on businesses that report PWD-related transactions. Establishments are required by law to maintain detailed records of their sales to PWDs, including customer names, PWD ID numbers, stated disabilities, discount amounts, and VAT exemption details.
The BIR will scrutinize these records to verify the legitimacy of the PWD IDs. If discrepancies are found, including the use of fake PWD IDs, the agency will disallow the deductions claimed by the establishments. Additionally, businesses will face assessments for deficiency VAT, along with applicable penalties and interest.
Collaboration with Government Agencies
To bolster its enforcement efforts, the BIR is strengthening its collaboration with key government agencies, including the Department of Health (DOH) and the National Council on Disability Affairs (NCDA). These partnerships aim to enhance the verification process for PWD IDs and prevent the proliferation of fake cards.
“With the assistance of key government agencies, strengthening enforcement and improving the monitoring of PWD-related transactions can help minimize fraud, ensure that benefits reach legitimate PWDs, and protect the integrity of the government’s tax system,” the BIR said.
Protecting Legitimate PWDs
The BIR’s campaign seeks not only to recover lost revenues but also to protect the rights and privileges of legitimate PWDs. Commissioner Lumagui reiterated that the law intends to support PWDs by easing their financial burdens. “Expect the BIR to run after fake PWD ID sellers and users,” he warned.
This nationwide crackdown underscores the government’s commitment to curbing fraudulent practices and ensuring that the benefits intended for PWDs are not undermined. Through intensified audits and inter-agency collaboration, the BIR aims to restore the integrity of the system and uphold fairness in the distribution of PWD benefits.