BIR files P222-M tax evasion cases before Justice Dept.

The Bureau of Internal Revenue on Thursday filed tax evasion cases worth at least P222 million at the Department of Justice against a foundation of a prominent business organization, a wholesaler of paper and paper products and a former member of the board of trustees of the Government Service Insurance System (GSIS).   The BIR filed a P47-million tax evasion case against the Makati Rotary Club Foundation Inc. (MRCFI) and its responsible officers for passing off as a donation part of the revenues from the lease of its 20,063-square meter property in Parañaque.   MRCFI’s 2000 to 2004 lease contract with Fedders Koppel provides for a lease of P4 million for 2000 that increased to P4.9 million by 2004 and an annual donation of P2 million, the bureau said in a statement.   The contract covering 2005 to 2009 provided for an annual lease of P4.2 million plus VAT for the five-year period plus annual donations.   The contract provides for a donation of P3 million for 2005, P3.2 million for 2006, P3.3 million for 2007, P3.6 million for 2008 and P3.9 million for 2009.   The BIR said the records on the transaction “reveals the clear intention of MRCFI to evade taxes by splitting the payment for the lease into rental and donation.”   Calling part of the lease as a donation is a tax saving scheme, according to the BIR.   MRCFI also did not declare the P23.1 million donation as part of its rental income, and was not included in the computation of its corporate and value added taxes from 2000 to 2009, the bureau noted in its complaint. Willfully failing to pay taxes   Aside from the MRCFI, the BIR is also seeking to charge its chairpersons, presidents and treasurers, including Felix B. Amparo, Jose A. R. Bengzon III, Federico S. Borromeo, Jr., Larry A. Boyer, Juan J. Carlos, Jr., Ramon T. Diokno, Tomas T. De Leon, Robert F. Kuan, Ricardo G. Librea, Conrado G. Marty, Alfredo B. Parungao, J. Antonio M. Quila, Wellington C. Soong and Jesus F. Tambunting.   The BIR also filed a P162.82-million case against a wholesaler of paper and paper products, Eagle’s Fortune Inc., for violating section 255 of the National Internal Revenue Code for willfully failing to pay taxes.   The bureau found Eagle’s Fortune faking purchases to claim input value added tax and faking some sales to claim output VAT.   In addition, the BIR discovered that Eagle’s Fortune did not declare at least P181.6 million worth of sales to United Pulp and Paper Co. Inc. and Steel World Manufacturing Corp.   The BIR included Eagle’s Fortune Inc.’s general managers, Whang Zhi Zin and Alex Ong in its complaint.   The bureau said it also filed a P12.32-million tax evasion case against Jesus I. Santos, former member of the GSIS board of trustees.   Santos is the third former GSIS board of trustees to be charged with tax evasion for not declaring his actual income.   The case against him stemmed from an inquiry conducted by the Senate committee on finance on the excessive salaries and unwarranted bonuses and allowances of appointees in government-owned and -controlled corporations and government financial institutions in 2010.   The BIR assessed Santos’s tax liability at P12.32 million for the four-year period, including surcharge and interest. — VS, GMA News