BIR sues head of doctors’ association for tax evasion

MANILA, Philippines (UPDATED) – The medical industry suffers another blow from the Bureau of Internal Revenue (BIR).

The BIR filed before the Department of Justice Thursday, March 27 a complaint against Philippine Medical Association (PMA) president Leo Olarte for his alleged attempt to evade taxes.

The filing came amid a word war between the bureau and PMA over the bureau’s recent print advertisements portraying doctors as tax cheats.

The BIR said Olarte was charged for failing to pay income and value-added taxes and file his income tax returns and VAT returns for the years 2006 to 2012.

Olarte is a medical practitioner and lawyer by profession. He is a professor of Legal Medicine at the FEU-NMRF Institute of Medicine, and teaches Torts and Damages at the FEU Institute of Law and UE College of Law.

Based on an investigation conducted by the BIR, Olarte earned from two or more employers, and from the exercise of his profession the amounts:

• 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
• P1,191,576.01 in 2012

However, the BIR said Olarte did not pay taxes and did not file his ITRs and VAT returns for said years.

“Further investigation showed that Olarte adopted the scheme of ‘end-dating’ his records with the Integrated Tax System of the BIR to avoid detection of his non-filing of income tax return and the non-payment of income tax and thus, precluding the computer system from generating open cases against him,” said the bureau.

Olarte owes the government P2.93 million in deficiency taxes, inclusive of surcharges and interests.

‘Trial by publicity’

In a phone interview with Rappler on Thursday, Olarte denied he failed to pay his taxes.

“I don’t earn that much, and I don’t also think magkakautang ako sa gobyerno ng ganung kalaki,” he said, referring to his supposed P2.93-million tax deficiency.

(I don’t earn that much, and I also don’t think I will owe the government that much.)

He has yet to receive a complaint affidavit from the BIR.

He also questioned the timing of the complaint, a few weeks after he spoke against what he called the “smear and shame campaign” of the BIR against medical doctors.

“Kung 2006 pa, bakit ngayon lang [nag-file]? They could’ve filed earlier kung may ebidensya sila,” he said.

(If I had not paid since 2006, why file the case only now? They could’ve filed earlier if they had the evidence.)

Earlier this month, PMA decried a BIR advertisement that showed a doctor piggybacking on a school teacher to illustrate the burden of improper tax payment. (READ: BIR ad on cheating doctors: A plan that backfired?)

Olarte called it “absolutely unfair,” and insisted doctors do not deserve to be portrayed as tax evaders. Henares said the ad was “not insulting and only making a statement of fact.”

He said he was just doing his job as the president of PMA to defend doctors.

He also slammed the “trial by publicity” and urged the BIR to just file cases without media fanfare. He will file a counteraffidavit after receiving the official complaint from the BIR.

“Kung may utang, babayaran ko, pero ‘pakita [muna nila] ebidensya,” he said. (If I owe anything, I’ll pay, but they should first show evidence.)” – with reports from Jee Geronimo/Rappler.com