BIR intensifies efforts vs. ghost receipts through data analytics

Bureau of Internal Revenue (BIR) Commissioner Romeo Lumagui Jr. (Photo: Romeo “Jun” Lumagui Jr./Facebook)

By Filane Mikee Cervantes, Philippine News Agency

MANILA – The Bureau of Internal Revenue (BIR) has intensified efforts to combat the proliferation of ghost receipts by leveraging data analytics and mathematics.

In a press conference on Tuesday, BIR Commissioner Romeo Lumagui Jr. said the agency has partnered with the Ateneo de Manila University-Math Department to employ an algorithm that can detect ghost receipts with “remarkable accuracy”.

Ghost receipts pertain to receipts issued with no or fictitious underlying transactions.

Lumagui said the total value of ghost receipts issued has already reached PHP1.3 trillion.

Meanwhile, he said the government lost PHP370 billion in revenue as a result of ghost receipts.

“Today marks a significant milestone in our relentless fight against tax fraud. Ghost receipts, these deceptive documents, used to illegally reduced taxable income have long undermined our revenue system. This sinister practice has caused the government billions of pesos in lost tax collection and we have largely been unable to detect and combat it until now,” Lumagui said.

“In our quest for a more systematic approach to detect such fraud, we turn to mathematics and data analytics,” he added.

Lumagui said the algorithm developed by the BIR and Ateneo employs techniques like network analysis and Benford’s law, which would serve as “powerful tools” to fight fraud and detect the likelihood of ghost receipts.

“This partnership ay malaking tulong po sa amin mas maging aggressive at mas ma-pinpoint sino ba talaga ang involved dito sa mga ghost receipts (is a huge help for us in becoming more aggressive and pinpointing those involved behind [the proliferation of] ghost receipts),” he said.

Through its Run After Fake Transactions (RAFT) program, the BIR has already filed criminal cases against the buyers and sellers of ghost receipts.