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Tax Evasion Penalties: Fines of Up to ₱10 Million and Imprisonment
The Philippine government has implemented severe penalties for those who fail to pay their taxes. If proven guilty, tax evaders can face fines of not less than ₱500,000 but not more than ₱10 million and imprisonment of not less than six years but not more than ten years.
Fines and Imprisonment
The grounds for these penalties include:
- Printing receipts, sales, or commercial invoices without authority from the Bureau of Internal Revenue (BIR)
- Double or multiple sets of receipts and invoices
- Receipts and invoices without numbers, business names, and other identifying information of the issuer
Other Penalties
In addition to fines and imprisonment, tax evaders may also face:
- Surcharge of 20% of the unpaid taxes
- Interest on the unpaid taxes at the rate of 12% per annum
- Revocation of their business permits or licenses
Reward for Informants
The government is offering a reward to those who report tax evaders. Once the reported party has been found guilty, the informant will receive a sum equivalent to 10% of the revenues, surcharges, or fees; or ₱1 million, whichever is lower.
How to Report Tax Evasion
To report tax evasion, individuals can use the eComplaint Run After Tax Evaders (R.A.T.E.) form. The form requires documents showing the income and expenses of the business, as well as bank records and other financial statements.
Importance of Paying Taxes on Time
The government is emphasizing the importance of paying taxes on time to avoid penalties and fines. Individuals are encouraged to pay their taxes online for quicker and hassle-free transactions.
Final Thoughts
Tax evasion is a serious offense that can result in severe penalties, including fines and imprisonment. To avoid these penalties, it is essential to pay taxes on time and accurately report income and expenses. The government is urging individuals to take taxes seriously and do their part in helping the country’s economy grow.