BIR files tax case vs Enrile’s former exec

MANILA, Philippines – The Bureau of Internal Revenue (BIR), the government’s main revenue agency, has filed tax evasion charges worth P100.4 million against 2 real estate companies controlled by the former accountant of Senate President Juan Ponce Enrile.

BIR Commissioner Kim Henares led the filing at the Department of Justice (DOJ) against Virkar Realty Corp. and Woodheights Realty and Development Corporation and their respective corporate officers.

These companies are led by Nora Bitong and Reynaldo Bitong who were also named in the case.

Mrs. Bitong was previously a top exective of the Jaka Group of Companies, the holding firm of Enrile’s family that is engaged in, among others, real estate.

Enrile is currently the presiding judge at the ongoing Malacanang-backed impeachment trial against Chief Justice Renato Corona.  

Sale of property

According to the BIR complaint, the Bitongs are being charged for

• 2 counts of attempting to evade taxes
• one count of failing to supply correct and accurate information on its value added tax (VAT) return
• one count of failing to supply correct and accurate information in its income tax return

Henares said the case stemmed from the sale in 2008 of a 927-square meter commercial property along Jupiter St. in Makati City.

Virkar, formerly Kronbi Realty Corp., sold this for P55.62 million.

The company paid the 6% expanded withholding tax on the sale but did not declare it as part of its gross sales for 2008.

“As a realty company, Virkar Realty Corporation should have declared the land as an ordinary asset subject to the regular 32% income tax rate and the 12% value added tax,” the BIR said in the case filed before the Justice department.

The agency said that in its income tax return (ITR) and financial statement, Virkar made it appear the property is a capital asset subject to the 6% capital gains tax.

Based on the BIR assessment, the real estate company owes the agency least P83.9 million in income and value added taxes for the sale of the property.

Lexus cars

Aside from Virkar, the BIR also filed a criminal complaint yesterday against Woodheights and its corporate officers Edwin Gardiola, Judy Gardiola, Kim Ann Gardiola, Katrina Mara  Gardiola and Donna Nicanor for attempting to evade taxes and deliberate failure to file income tax returns.

The charge stemmed from Woodheights’ purchase of 3 Lexus vehicles worth P20.834 million in 2009 from Lexus Manila Inc.

When the BIR checked Woodheights’ tax returns for 2008 to 2010, it learned that the company did not declare any income or paid taxes for the period.

Henares said the BIR is seeking P16.5 million in taxes from Woodheights representing P11.77 million in income tax and P4.75 million in VAT.

The filing of tax-related cases are part of the name-and-shame campaign of the Aquino administration as part of efforts to improve tax collections. – Rappler.com