BIR sues Maybank Philippines affiliate with P169.83-M tax evasion case

The Bureau of Internal Revenue (BIR) on Friday said it sued before the Department of Justice an affiliate of Malaysian-controlled Maybank Philippines Inc. and its officials for P169.83 million in unpaid taxes. Criminal charges were also filed against Philmay Property Inc. president Ong Seet-Joon, treasurer Atty. Rafael Morales, corporate secretary Atty. Jonathan P. Ong, sales and marketing department head Benjamin Q. Lira and remedial accounting associate Michelle F. Reyes. Sought for comment, a Philmay representative told GMA News Online, "We are not in any position to comment on that as of now. "Higher management will come out with a statement," she added. According to a BIR computation, Philmay accumulated P169.83 million in tax deficiencies, including surcharge and interest: P37.81 million in income tax deficiency P73.13 million in value-added tax deficiencies P15.57 million in documentary stamp tax deficiency P43.32 million in expanded withholding tax. Philmay was among the real estate companies that were allowed to have foreign equity for a limited period under the country’s Special Purpose Vehicle Law to help banks unload foreclosed assets after the 1997 Asian financial crisis. The BIR said Philmay declared a P50.64–million loss in its annual income tax return for the fiscal year ending June 30, 2009. In November 2009, the BIR looked into the books of Philmay. The bureau said three of its revenue officers initially came up with a tax assessment of P51.96 million which was somehow trimmed down to P499,206.53. The BIR also filed criminal cases against the three revenue officers who first investigated Philmay’s books and records. The real estate firm claimed a deductible expense amounting to P3.21 million for the fiscal-year ending June 30, 2009 which represents salaries and wages. "[It] shouldn’t have claimed it as a deduction as it failed to withhold any tax on the salaries and wages which should have been done monthly," BIR said. The company also claimed P50.21 million in operating expenses in its income tax return for the same year that included salaries, allowances, fringe benefits and interest expenses that were not supported by any document, the BIR noted. In addition, Philmay did not report P95.07 million in real estate sales in its value added tax return for the year, the bureau said, noting the company neither did the company pay the necessary documentary stamp taxes for the transactions. The BIR said it learned that Philmay paid its creditor, Maybank Philippines Inc. P61.18 million, with interest expenses amounting to P47.6 million and that the loan was a related party transaction. Philmay is 39.99 percent owned by Malayan Banking Berhad, that also owns 99.99 percent of Maybank Philippines, the BIR noted. — Danessa Rivera/VS, GMA News