FFCCCII welcomes LOA reforms

December 31, 2025 | 12:00am

MANILA, Philippines — The Federation of Filipino-Chinese Chambers of Commerce and Industry Inc. (FFCCCII) expressed support for Finance Secretary Frederick Go’s initiative to introduce reforms to curtail the misuse of letters of authority (LOAs) and related audit instruments of the Bureau of Internal Revenue (BIR), noting the move sends a positive signal to investors.

In a statement, the FFCCCII welcomed the move, noting that it strengthens the foundations of a just and professional tax administration.

Go earlier said that the government is looking at reforms, including limiting the number of BIR offices authorized to issue LOAs.

The move was prompted by complaints that LOAs are being abused and used as a tool for extortion.

LOAs allow the BIR to examine taxpayers’ books.

“This reform represents a pivotal advancement in governance – one that aligns precisely with the business community’s urgent call for transparency, predictability and equitable application of the law,” the FFCCCII said.

To encourage investments during these challenging and uncertain times, the FFCCCII said the economy needs tangible support, clear systems and genuine ease of doing business.

It said arbitrary or overreaching enforcement actions erode the confidence that supports the country’s growth.

It also said that audits exceeding their scope or validity, overlapping investigations and a lack of digital traceability in the issuance of authorities create an environment of uncertainty that discourages both compliance and investment.

For the FFCCCII, Go’s initiative directly addresses these concerns and ensures that state power is exercised with accountability and restraint.

For businesses to expand and support growth through job creation and tax revenues, the FFCCCII said there is a need for fair and clear rules.

The FFCCCII said the reforms also demonstrate the Philippines’ commitment to promote a rules-based, predictable and fair business environment by protecting investors from arbitrary administrative actions.

“Secretary Go’s decisive action transcends mere procedural adjustment; it is an investment in confidence itself. By instituting greater transparency and accountability in tax audit processes, we protect the integrity of our institutions and fuel the confidence that leads to job creation, innovation and shared national progress,” FFCCCII president Victor Lim said.

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