The Bureau of Internal Revenue (BIR) will pursue tax liabilities of contractors allegedly involved in ghost infrastructure projects, saying that the entire project cost will be treated as taxable income if no actual expenses were made.
BIR Commissioner Atty. Romeo Lumagui Jr. explained that in cases where projects are found to be nonexistent, the government will compute taxes based on the total amount paid to contractors.
“Imu-multiply natin sa corporate tax rate. Depende ‘yun kung kailan na [ibigay] yung project. Kung 25% yung rate niyan, 25% 'yun. 'Yun na ang taxable income dahil wala talagang gastos 'yan,” Lumagui said.
Lumagui noted that if a ghost project worth ₱100 million is discovered in 2025, the corresponding tax liability would immediately amount to ₱25 million, based on the 25 percent corporate tax rate.
Lumagui stressed that even without physical implementation, the tax liability remains.
“’Yung iba pang mga illegitimate na expenses pwede 'yun dahil nga ghost project. Pero doon pa lang sa contractor ng isang ghost project, 25% na agad sa isang ghost project pa lang,” he added.
For legitimate projects, however, corporations are allowed to deduct actual expenses such as materials, wages, and operating costs before computing net taxable income.
“Ang unang gagawin diyan, i-total lahat ng revenues tapos lahat ng mga expenses nila. Yung mga materyales, yung mga pasweldo sa mga trabahador, lahat 'yan ibabawas. Yung neto niyan ang magiging basehan nung taxable income. Ngayon nasa 25%,” the BIR chief said.
Lumagui also confirmed that the BIR is currently investigating and auditing the contractors flagged by President Ferdinand Marcos Jr., particularly those involved in the controversial “ghost” flood control projects in Bulacan, where the President himself found no work done.
Discayas’ luxury assets to undergo investigation and audit
Meanwhile, luxury cars flaunted by some contractors are also under scrutiny.
Former Pasig City mayoral candidate Sarah Discaya and her husband, who own Alpha & Omega General Contractor & Development Corp. and St. Timothy Construction Corporation, ranked second and third, respectively, on the Department of Public Works and Highways’ (DPWH) list, have admitted that the vehicles belong to them.
“Isasama dapat iyan, sila na mismo ang nagsabi na sa kanila ito,” Lumagui said, referring to the admission of ownership of luxury vehicles by contractors.
The BIR is currently consolidating documents from the Department of Public Works and Highways (DPWH) and other agencies to validate project payments.
Lumagui assured that contractors will still be given due process, but stressed that ghost projects are a high-priority audit case.
