Newly-appointed Finance Secretary Frederick Go said the nationwide suspension of all Bureau of Internal Revenue (BIR) field audits is intended to protect taxpayers from arbitrary or poorly justified inspections, describing Letters of Authority (LOAs) as instruments that should meet standards similar to search warrants.
Speaking in an interview on DZRH News’ Special on Saturday on November 29, he said the pause creates space for a full review of long-standing audit practices that businesses, foreign chambers, and investors have repeatedly flagged as problematic.
Go also stressed the need for clear standards governing the issuance of LOAs, cautioning that these authorizations cannot be based on discretion or convenience.
“There’s a review of the policies, a review of the mechanisms of how they operate. Katulad po nitong mga Letters of Authority. I think it’s very important na ma-establish po natin ano ’yung mga rason na nag-iissue ng Letters of Authority ang BIR. Hindi ’to pwedeng arbitrary. Hindi ’to pwede basta-basta lang or na-issuehan ng LOA ’yan,” Go said.
“Mas importante po na pag-aralan natin ano ’yung justifications, ano ’yung legal basis ng pag-iissue ng Mission Orders at Letters of Authority. Ang pananaw ko kasi po dito ay parang po ’tong Search Warrant, ’di ba? Hindi naman tayo pwedeng pumasok lang sa isang bahay ng isang tao just because dahil lang gusto nating gawin. Kailangan may probable cause,” he added.
Go noted that during his nearly two years as Special Assistant to the President for Investment and Economic Affairs, his office routinely received similar complaints from major business groups, industry associations, ambassadors, and foreign investors.
“Medyo pare-pareho po ang mga pinapadala nilang problema sa opisina ko tungkol sa BIR,” he said, adding that he brought those insights with him upon assuming leadership of the Department of Finance (DOF). The audit suspension, he said, responds directly to pervasive issues raised long before the current reforms.
He said taxpayers will benefit from a systematic review of LOA and Mission Order protocols, which he described as essential to ensuring predictability and fairness.
Despite the halt, Go stressed the impact on revenue will be limited, as only about 2% of BIR collections come from LOA-driven audits. “Generally naman po eh nage-exceed ang BIR ng target, tumaas din naman ang revenue collection,” he said.
Go also noted that when deficiencies are found, taxes must be remitted properly and directly to the National Treasury. Ensuring collections reach government coffers, he said, is essential to funding national programs and infrastructure. “Very important po ’tong taxpayers’ money because this is what gives the lifeblood ng economy natin,” he added.
In joint announcement made on November 24, Go and BIR Commissioner Charlito Martin Mendoza declared an immediate halt to field audits under Revenue Memorandum Circular No. 107-2025.
Mendoza ordered that no LOA or Mission Order be issued, printed, signed, or served during the suspension period, with exceptions only for urgent or legally mandated cases such as criminal investigations or audits nearing prescription.
The BIR has since formed a Technical Working Group on LOA and MO Integrity and Audit Reforms to overhaul procedures, identify systemic vulnerabilities, and introduce evidence-based and technology-driven safeguards.
