BIR runs after eye doctor, realty owners

AN EYE doctor and owners of a real estate firm have been added to the roster of alleged tax evaders with complaints filed against them at the Department of Justice.

Cebu-based ophthalmologist Potenciano Sto. Domino Larrazabal III, according to the Bureau of Internal Revenue (BIR), has been cited for "willful attempt to evade or defeat tax, deliberate failure to supply correct and accurate information in his income tax returns (ITRs), and willful failure to file value-added tax (VAT) returns for taxable years 2009, 2010 and 2011."

The agency said in a statement Mr. Larrazabal is the husband of singer/actress Donna Cruz.

According to the BIR, information it obtained from records with the Philippine Health Insurance Corp., in particular the certificate of creditable tax withheld at source and professional fees payments notices, showed that Mr. Larrazabal earned ₱10.87 million in 2009, ₱8.88 million in 2010, and ₱9.38 million in 2011, or a total of ₱29.13 million.

However, the BIR said Mr. Larrazabal’s ITRs and percentage tax returns (PTR) showed he only declared an income of ₱1.48 million in 2009, ₱1.49 million in 2010, and ₱1.75 million in 2011, "underdeclaring his taxable income by ₱9.39 million or 635% in 2009, ₱7.39 million or 493% in 2010, and ₱7.63 million or 437% in 2011."

Further, the BIR said Mr. Larrazabal failed to register as a VAT taxpayer when his income of ₱3.18 million for the first quarter of 2009 exceeded ₱1.5 million, the minimum amount whereby a person should pay VAT.

"Rather, he only filed PTRs for the years 2009, 2010 and 2011 and made it appear in said returns that he only earned ₱300,000 for the 1st quarter of 2009 and ₱1.48 million for the year 2009 which would not make him liable for VAT," read the BIR statement.

Mr. Larrazabal has been assessed a tax liability of ₱21.14 million, inclusive of surcharges and interests, it added.

COLLUSION
Meanwhile, a separate complaint has been filed against Taguig City-based Philmay Property, Inc. (PPI) as well as its executives Ong Seet-Joon, Rafael Morales, Jonathan P. Ong, Benjamin Q. Lira and Michelle F. Reyes for "willful attempt to evade or defeat income tax, value-added tax, documentary stamp tax (DST) and expanded withholding tax (EWT).

Also charged were revenue officers Vicente Velario, Joseph Macuha and Noradel Mendoza who were authorized to examine PPI’s records from July 1, 2008 to June 30, 2009.

A reinvestigation showed that company officials failed to file the DST return and supply correct and accurate information on the company’s ITR and VAT return for the fiscal year ending June 30, 2009.

On a tip of "a confidential informant," the revenue agency claimed PPI "evaded the payment of the correct amount of taxes in the sum of ₱169.83 million, inclusive of surcharges and interests" after it connived with three revenue officers on the company’s deficiency taxes.

"An agreement form was completed on July 9, 2010 with the revenue officers saying that an audit examination was conducted and that the deficiency tax amounted to only ₱499,206.53," the BIR said.

"Without the cooperation of said revenue officers through the issuance of a tax assessment amounting to only ₱499,206.53 PPI could not have avoided the payment of its correct tax liabilities for the fiscal year ending 30 June 2009 which is ₱169.83 million," it added.

The BIR further noted that PPI claimed a deductible interest expense of ₱47.6 million for a loan from Maybank Philippines, Inc. (MPI).

A probe by BIR agents found out that the loan transaction was a "related transaction" since MPI is 99.99% owned by Malayan Banking Berhad (MBB) which also owns PPI by at least 59.99%.

"As such, the interest expense should not be claimed as deductible expense," read the BIR statement.

The agency also found out that PPI allegedly claimed a deductible expense worth ₱3.21 million representing salaries and wages without withholding any tax due and ₱50.2 million as operating expenses without supporting documents.

"Said schemes led to an underdeclaration of PPI’s taxable income by as much as 69.56% and the non-payment of income tax in the aggregate amount of ₱37.81 million," the BIR said.

Further, PPI allegedly failed to report ₱95.07 million of its real estate sales for 2009 which resulted in the non-payment of VAT worth ₱73.13 million, DST worth ₱15.57 million, and EWT worth ₱43.32 million. -- DEDS

Oro police score against fake dollars

By Loui S. Maliza

THE Criminal Investigation and Detection Group (CIDG) in Cagayan de Oro scored in its campaign against the proliferation of fake bills following the arrest of a suspected counterfeiter in an entrapment operation Monday afternoon in Barangay Tablon.

Senior Inspector Pepito Reyes, chief of the city’s CIDG, identified the suspect as Rogelio Gaid, 57, married, a native of in Kitaotao, Bukidnon.

Reyes said it was a joint operation with representatives from Bangko Sentral ng Pilipinas (BSP) in Manila that resulted to the apprehension of the suspect.

“The BSP representatives certified the bills as fake, which then signaled the operatives to apprehend the suspect,” Reyes said.

He said Gaid was with two other companions while transacting with CIDG undercover agents posing as buyers.

Gaid told Sun.Star Cagayan de Oro in an interview that his associates eluded arrest.

The suspect identified his companions as alias Dodong and Roberto, both residents of Barangay Balubal, this city.

Gaid held a backpack containing 145 US currency bills in different denominations worth $41,548 placed inside a brown envelop.

Reyes said the bills’ market worth is P6.1 million and is intended to be sold to wealthy people, the prospective clients of the suspect.

“The suspect belongs to an organized crime group operating in Northern Mindanao. Bihasa ito. Kaya nilang magsalita para bilugin ang ulo ng mga tao lalo na nung hindi nakakikilala sa kanila and swindle them (victims) (...They are well-versed. They can speak well enough to confuse people specially those who do not recognize them and then swindle the victims.),” Reyes told SunStar Cagayan de Oro.

Reyes said Gaid and his group were under surveillance two weeks ago following an intelligence report from a CIDG-recognized community investigative support (CIS).

He said the CIDG undercover agents then held a “test-buy”.

They bought worth P1,000 dollar bills in different denominations from Gaid’s group.

The bills then were forwarded to the BSP-Manila for examination. When the BSP-Manila certified the bills as fake, the entrapment operation was conducted.

But Gaid denied the allegations saying he was there only for another transaction with two of his accomplices.

“Wala gyud ko kahibalo, sir,” he told Sun.Star Cagayan de Oro, adding that “naa lang ko didto aron mag-istorya mi parte sa falcata nga kahoy nga among komprahon didto sa Kitaotao aron dalhon dinhi sa Cagayan (I don’t know anything about this. I was only there to talk to those people about our deal to buy falcata logs in Kitaotao [Bukidnon] which we plan on bringing to Cagayan).”

“Wala gani ko kahibalo ngano nga naa sa sulod ang kanang mga kwarta diha sa akong bag. Sige baya ko simba, sir unya mosulod na hinoon ko sa ingon ani (I don’t even know why there was money inside my bag. I regularly go to church, sir, so why would I get into this kind of thing?)” he added.

“Pero sa mga ebidensiya na nakuha natin sigurado kulong siya for violation of Article 168 of Revised Penal Code otherwise known as counterfeiting money bills. Pero bailable naman ito (But with the evidence that we gathered from him, surely he will be convicted in violation of Article 168 of the Revised Penal code otherwise known as counterfeiting money bills. But this is bailable),” Reyes said.

The case was filed Tuesday morning at the City Prosecutor’s Office.

Gaid said he is willing to cooperate with the authorities for the capture of his two other accomplices.

“Motabang gyud ko aron makabalos ko sa ilaha kay giilad ko nila (I will fully cooperate with the police so I could get even with them for deceiving me),” Gaid said.

Well-done

The BSP-Manila congratulated the CIDG-Cagayan de Oro for a well done job.

Edmundo Leopoldo, one of BSP’s currency analysts, told Sun.Star Cagayan de Oro that BSP certified the confiscated bills as fake and that it will be brought to Manila for laboratory examination.

“Sandali lang ang pagkilala sa fake na dollar bills. But we still need to conduct laboratory examination to determine how they were manufactured—electronic or by a printing machine,” he added.

Reyes said the CIDG’s next objective would be to identify the places where these bills are manufactured and the machine that the suspects used for production.

“This is our next objective - to prevent the circulation of fake money in the market,” he added.