ON July 31, 2026, the Bureau of Internal Revenue will commemorate its 122nd anniversary with the theme ‘Husay at Dangal: Lingkod-Bayan ng BIR.’
The BIR was formally organized and made operational on August 1, 1904, following the enactment of Reorganization Act No. 1189 on July 2, 1904. It began with only 69 officials and employees, headed by the first Collector of Internal Revenue. From that modest organization emerged the government institution that now carries the principal responsibility for financing public services and national development.
I am pleased to have been invited to join this year’s anniversary celebration on July 31 at the BIR National Office compound in Diliman, Quezon City. This year’s gathering will be more low-key than the elaborate celebrations of some previous years-a fitting opportunity for reflection rather than spectacle.
The anniversary provides an occasion to look back at the reforms that transformed the BIR from a predominantly manual organization into an increasingly digital and data-driven, service-oriented tax administration. I have discussed the administrative reform undertaken by the BIR over the past decades. For my article next week, I will dwell on the major laws that were passed over the more than a century of existence of the BIR.
One of the earliest foundations of modern tax administration was the establishment of a unified system for identifying taxpayers. The old Tax Account Number, or TAN, was first utilized in 1976. I still retain the light yellow colored TAN card issued to me in 1980 when I started working.
The TAN was eventually replaced by the Taxpayer Identification Number, or TIN, in 1991. The TIN became the permanent identifier linking taxpayers to their registration, return filing, payment, and audit records.
The next great milestone was the Tax Computerization Project (TCP), which started in the 1990s. This produced the Integrated Tax System, or ITS, supported by Revenue Data Centers, computerized registration, returns processing, collection accounting, and taxpayer-account databases. Computerization began replacing ledgers, index cards, and physical folders that previously made the verification of taxpayer information slow and difficult. I am proud to have been part of the TCP, having been appointed one of the Project leaders at the time.
One major milestone in the BIR history was the creation of the Large Taxpayers Service (LTS) in 2000. This brought the country’s biggest corporate taxpayers under specialized monitoring and account management. The LTS model recognized that a relatively small number of taxpayers accounted for a substantial share of government revenues. The Large Taxpayers Service (LTS) has consistently contributed about 55 percent to 60 percent of the Bureau of Internal Revenue’s total tax collections over the past two decades
The launching of the Electronic Filing and Payment System, or eFPS, in 2001, was another historic milestone. It enabled taxpayers to file returns and pay electronically, reducing dependence on paper returns and over-the-counter transactions. What started with large taxpayers was subsequently expanded to other mandatory users. Incidentally, the eFPS celebrates its 25th year of existence this year. About 85 percent of BIR tax collections are now received through the eFPS.
The Reconciliation of Listings for Enforcement, better known as RELIEF, introduced data matching into tax enforcement. Through taxpayers’ schedules of sales and purchases, the BIR could compare a seller’s declared sales with the buyer’s reported purchases. Discrepancies became potential indicators of under-declaration, unreported income or unsupported claims.
RELIEF was revolutionary for its time. It demonstrated that tax enforcement need not depend solely on an examiner manually inspecting books. Information already submitted by taxpayers could be matched and analyzed to identify compliance risks.
Another important development was the publication of the BIR Monitor, a weekly newsletter which started as a printed copy with pictures of activities conducted by BIR employees. It continues to be issued to this day, trumpeting the achievement of revenue, but now in digital form already. I was then the BIR Commissioner who conceptualized and created the BIR Monitor in 2009.
Enforcement programs also became more visible. The Run After Tax Evaders, or RATE, program institutionalized the filing of criminal tax-evasion complaints. Oplan Kandado authorized the temporary closure of businesses for serious violations, including substantial understatement of sales and failure to issue invoices. Industry benchmarking, lifestyle checks, third-party information matching and inter-agency data exchanges further expanded the BIR’s enforcement tools.
During my term as Commissioner from 2009 to 2010, we pursued the reinvigoration of RATE, Project R.I.P. or ‘Rest in Peace’ for the estates of deceased taxpayers with unsettled obligations, taxpayer lifestyle checks, the development of industry champions and audit of large-ticket items. We also strengthened linkages with other government agencies to provide the BIR with information useful for registration, assessment and collection. The BIR’s historical account records these initiatives as part of its institutional development.
I will discuss in a future column the tax collections and strategy of the BIR in raising revenues by means of administrative tax amnesties. There were several of these measures instituted by the BIR that resulted in billions of taxes collected. These, with the legislative tax amnesties, will be a topic of discussion in a future article.
The subsequent introduction of eBIRForms in 2012 gave taxpayers outside eFPS an electronic facility for preparing and filing returns. The newer Electronic Tax Information System, or eTIS, was intended to replace and improve upon the aging ITS platform.
More recent reforms include the Online Registration and Update System, or ORUS, that was launched in 2022. Through ORUS, taxpayers can conveniently apply for registration and update certain information online. The BIR now also provides electronic facilities involving tax clearance, certificates authorizing registration, appointments, payments and other transactions. Its Citizens’ Charter confirms that several registration services, including applications for TINs, are now available through ORUS.
The Electronic Invoicing System represents the next major frontier. Instead of waiting for periodic returns and summary lists, electronic invoicing can eventually provide the BIR with more timely transaction-level information. Properly implemented, it can strengthen VAT verification, detect fictitious transactions, improve audit selection and support near-real-time compliance monitoring.
The BIR is now entering the age of compliance-risk management, advanced analytics and artificial intelligence. The central challenge is no longer simply to collect more information. It is to integrate registration, invoicing, customs, property, corporate and financial information and convert these into fair and defensible compliance actions.
Technology, however, is not reform by itself. Digital transformation must produce faster taxpayer service, fewer unnecessary audits, risk-based selection, transparent case monitoring, and greater accountability among revenue officers. It should make compliance easier for honest taxpayers while making evasion more difficult.
As the BIR celebrates 122 years, its history should remind us that every generation of revenue officers inherited reforms from those who came before them. TAN led to TIN. Manual records led to computerization. Computerization led to electronic filing. Electronic filing and RELIEF led to data matching. These, in turn, are leading toward e-invoicing, tax analytics, and artificial intelligence.
The anniversary is therefore not merely a celebration of longevity. It is a celebration of public service and a reminder of unfinished work.
To Commissioner Charlito ‘Charlie’ Mendoza, the officials and employees of the Bureau, former revenuers, taxpayers, and the BIR’s institutional partners: congratulations on the 122nd anniversary of the Bureau of Internal Revenue.
May the next chapter of its history be defined by integrity, innovation, taxpayer trust and the continuing mission of bringing in revenues for nation-building.
To be continued
Joel L. Tan-Torres was the former Dean of the University of the Philippines Virata School of Business. Previously, he was the Commissioner of the Bureau of Internal Revenue, the Chairman of the Professional Regulatory Board of Accountancy, and a partner of Reyes Tacandong and Co. and the SyCip Gorres and Velayo and Co. He is a Certified Public Accountant who garnered No. 1 in the CPA Board Examination of May 1979. He is now back to his tax practice with his firm, JL2T Consulting. He can be contacted at joeltantorress@yahoo.com.