A measure in the Senate seeks to offer bigger, fairer, and more rational rewards for informants who would expose large-scale violators of the country’s tax and customs laws.

Senator Jinggoy Estrada, who filed Senate Bill No. 1011, said that it aims to strengthen the fight against tax fraudsters and smugglers

“Our fight against tax evasion and smuggling depends heavily on information from the public. But people won’t come forward if the law itself limits their protection and their reward,” Estrada said.

Estrada said his proposed SBN 1011 seeks to update the decades-old informer’s reward system, which he noted has become ineffective due to outdated ceilings that discourage whistleblowers from reporting large-scale fraud.

The current law puts a P1 million ceiling on the reward money that informants may receive, regardless of the size of the tax fraud or smuggling case, a cap which Estrada said has long undermined efforts to encourage public cooperation.

Under the proposed SBN 1011, informants who report tax fraud may receive as much as P10 million or 10 percent of the recovered taxes, whichever is lower. For smuggling cases, whistleblowers may be granted up to P10 million or 20 percent of the value of confiscated goods, whichever is lower.

The bill also ensures the confidentiality of the informants’ identities, imposes penalties for unauthorized disclosure, and prohibits establishments from denying responsibility once information leads to revenue recovery or seizure of goods. Violators of confidentiality rules may face fines of up to P1 million and imprisonment of up to 15 years.

Only information that leads to the actual recovery of revenue, surcharges, fees, penalties, or confiscated goods will qualify for a reward. Government officials, employees, and their close relatives are barred from claiming any reward.

“This bill encourages public cooperation in reporting tax cheats and smugglers. By rewarding informants fairly, we improve tax collection, enforcement, and administration in the BIR and BOC,” Estrada said.

“We want to empower citizens to help the government fight corruption and smuggling, while ensuring that their efforts are recognized and their identities protected,” he added.