BIR 'brazenly wrong' in P2.93-M tax evasion case – PMA chief Olarte

The P2.93-million tax evasion complaint filed by the Bureau of Internal Revenue against Leo Olarte, Philippine Medical Association (PMA) president, should be dismissed as it "maliciously" labeled him as a tax evader, the PMA chief claimed on Monday.

 

In a counter-affidavit, Olarte told the Department of Justice he had "no criminal intentions to willfully and knowingly attempt in any manner to evade or defeat any tax imposed under this (tax) code or payment thereof, much less willfully and knowingly fail to file, return, supply correct and accurate information and pay the tax due to the same government which I have served during the best years of my life."

 

Olarte, a doctor and lawyer by profession, said the BIR was "brazenly wrong" in accusing him of violating Sections 254 and 255 of the amended National Internal Revenue Code of 1997, when he failed to pay income and value-added taxes as well as to file tax returns from 2006 to 2012.

 

According to the BIR, Olarte adopted the "end-dating" scheme under the Integrated Tax System to hide the fact that he wasn't filing his income tax returns and wasn't actually paying his income tax.

 

In effect, the scheme kept the BIR computer system from generating open cases against the tax evader, the bureau said.

 

The bureau found out Olarte earned P569,825.88 in 2006, P221,206.22 in 2007, P226,186.90 in 2008, P774,940.59 in 2009, P715,515.62 in 2010, P992,298.84 in 2011, and P1,191,576.01 in 2012.

 

His income record was based on an alphalist submitted to the BIR by Olarte's withholding agents, including Far Eastern University, where he teaches medicine, and University of the East, where he teaches law.

 

The BIR assessed his tax deficiency, including surcharges and interests, at P2.93 million.

Withholding taxes paid

 

In his counter-affidavit, Olarte claimed the BIR "intended to maliciously impress in the public mind after a press conference and publication in several newspapers of nationwide dissemination, my income from 2006 to 2012, that respondent is truly a tax evader, in clear and convincing violation of Section 270 of the 1997 NIRC, which prevents "willful oppression" of tax payers.

NIRC is the National Internal Revenue Code of the Philippines or Tax Reform Act of 1997.

 

He said the BIR "willfully and knowingly" did not deduct the withholding taxes he already paid when the bureau computed his deficiency income tax.

 

"The complaint did not show nor consider the withholding taxes already filed and paid in the mathematical computation of the deficiency income tax," he said.

 

Olarte attached in his counter-affidavit BIR forms showing he paid P743,563.53 from 2006 to 2012.

 

In case he still has unpaid income tax, Olarte said: "Respondent is willing to pay, since respondent does not claim to be perfect in tax computations."

 

Olarte denied he knew the "end dating" scheme, saying it was his first time to hear the term, saying he didn't have personal access to the BIR computer system, and neither did he took part directly or indirectly nor did he conspired with the BIR to commit end dating.

 

The BIR failed to conduct a "formal fraud investigation" in violation of the tax code, he claimed.

 

"The BIR totally and unjustifiably failed to perform its bounden duty of sending letter notices to respondent, a clear dereliction of duty," he added.

 

Olarte said he did not intentionally file value-added tax returns, since his income did not reach the threshold level for VAT purposes. – VS, GMA News