Various illegal practices are employed to make unfounded claims for input tax credits (ITCs), input tax refunds (ITRs) and tax expenditures. One such practice, the issuing of false invoices, is prohibited because it could result in another business obtaining refunds to which it is not entitled. Businesses must remain vigilant and refuse to issue false invoices if solicited to do so.

All claims for ITCs, ITRs and tax expenditures must be substantiated by supporting documents that meet the requirements for preparing invoices set forth in tax legislation. In addition, supporting documents must accurately reflect actual transactions made between suppliers.

If businesses use false, inaccurate or erroneous documents or participate in such practices, their claims for ITCs, ITRs and tax expenditures will be disallowed. They will also be liable to heavy penalties and fines of up to 200% of the unpaid taxes.