BIR files raps vs contractors over Bulacan ghost projects

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The Bureau of Internal Revenue (BIR) has filed criminal complaints against two contractors accused of implementing ghost flood-control projects in Bulacan, charging them with multiple violations of the National Internal Revenue Code (NIRC) of 1997.

BIR Commissioner Charlito Martin R. Mendoza led the filing of the complaints before the Department of Justice against IM Construction Corporation, SYMS Construction Trading, and their responsible officers.

Combined tax assessments for the two firms amount to PHP 13.8 million, stemming from alleged fictitious expenses, underreported income, and false value-added tax declarations.

The respondents face charges for violating NIRC Sections 254 on tax evasion and 255 on willful failure to supply correct and accurate information, offenses that carry substantial fines and possible imprisonment.

Mendoza said the cases are part of a broader crackdown on contractors involved in fraudulent public works and falsified tax reporting.

He said the BIR is conducting expanded audits of related contractors and individuals and will file additional criminal complaints in the coming weeks.

“They took public money meant to protect families from flooding, and built nothing. That is corruption at its most shameless. The BIR will not allow contractors to enrich themselves through fake projects and falsified tax filings. We will pursue every offender, recover every peso, and continue filing criminal charges until this practice ends,” Mendoza said.

With these new filings, the BIR has now submitted 12 criminal complaints connected to anomalous flood-control projects.

The bureau said the estimated potential tax liabilities under investigation in these cases amount to PHP 8.87 billion.

BIR findings show that IM Construction Corporation received payments for the construction of a pumping station and flood gate in Barangay Sto. Rosario, Hagonoy.

A physical inspection confirmed that no structure of any kind had been built.

Because there was zero physical accomplishment, the firm’s declared project costs, deductions, and input taxes were deemed entirely fictitious, resulting in significant tax deficiencies.

Investigators described the declarations as a deliberate attempt to evade taxes while misusing funds allocated for critical flood-control infrastructure.

The BIR said SYMS Construction Trading also collected the full contract amount for the construction of a reinforced river wall in Barangay Piel, Baliuag.

However, field inspectors found that no river wall had been constructed at the site.

With no actual work completed, the company had no legal basis to claim any deductions or input taxes.

The BIR concluded that SYMS submitted false tax filings to conceal income derived from a fully paid but nonexistent public project.