MANILA. The Bureau of Internal Revenue (BIR) issued a stern warning on Thursday against the sale and use of counterfeit Person with Disability (PWD) identification cards, emphasizing that such actions amount to tax evasion.
In a statement, BIR Commissioner Romeo Lumagui Jr. expressed concern over the growing prevalence of fake PWD IDs, prompting him to direct the BIR’s officials to work closely with other government agencies to address the issue.
According to Lumagui, a recent Senate investigation revealed that this “tax evasion scheme” led to an estimated revenue loss of P88.2 billion for the government in 2023 alone.
“People who sell and use fake PWD IDs are not only committing tax evasion, they are also disrespecting legitimate and compliant PWDs. The discount given by law to PWDs is for the improvement of their well-being and easing of their financial burden,” Lumagui said.
He further stressed that PWD discounts are not meant to be a “common discount card” accessible to the general public. “Expect the BIR to run after fake PWD ID sellers and users,” Lumagui warned.
The Philippines’ 1987 Constitution recognizes the rights and needs of PWDs, and Republic Act (R.A.) No. 7277, amended by R.A. No. 10754, provides these individuals with a variety of benefits. Among these benefits are a 20% discount and exemption from Value-Added Tax (VAT) on specific goods and services for their exclusive use.
Unfortunately, Lumagui stated that unscrupulous individuals have been exploiting the system, selling fake PWD IDs to people attempting to fraudulently claim these benefits. These counterfeit IDs are not only sold on the streets but also through online marketplaces, making them easily accessible.
The issue was discussed in a Senate hearing on December 5, 2024, during which the Senate Committee on Ways and Means focused on the harmful effects of fake PWD IDs on businesses and the government. Senate Resolution No. 1239 aims to find solutions to prevent the sale of counterfeit IDs and curb the abuse of benefits meant for those with disabilities.
Lumagui confirmed that the BIR would continue its efforts to audit tax transactions involving PWDs, particularly those reported by establishments. As part of the regulations, businesses must submit records of sales to PWDs, including the name, ID number, disability, and the amount of discount and VAT exemption provided.
The BIR will verify the legitimacy of these PWD IDs, and if any fake IDs are detected, the deductions claimed by the establishments will be disallowed. Moreover, sales made using fraudulent PWD IDs will be subject to deficiency VAT, penalties, and interest, Lumagui explained.
To combat the widespread misuse of fake IDs, the BIR will strengthen its coordination with government agencies such as the Department of Health and the National Council on Disability Affairs to authenticate the legitimacy of PWD IDs.
This crackdown on fraudulent PWD IDs seeks to protect the rights of legitimate PWDs and curb the significant losses to government revenue, ensuring that these vital benefits reach those who truly need them.
Carlo Juancho FuntanillaFrontend Developer, WordPress, Shopify
Contributing Editor
AMA ACLC San Pablo
