Pacquiaos ask SC to stop BIR from confiscating assets

MANILA, Philippines – World boxing champion and now senatorial aspirant Emmanuel “Manny” Pacquiao and his wife Jinkee are asking the Supreme Court (SC) to stop the Bureau of Internal Revenue (BIR) from confiscating their assets.

The revenue collecting agency alleges that the couple has a tax deficiency of P3.29 billion for years 2008 and 2009. To cover the amount, it has issued a warrant of distraint and levy and garnishment order against the Pacquiaos.

The BIR is trying to collect nearly double the Pacquiaos’ declared assets.

Their original tax liability was P2.26 billion, but surcharges and penalties bloated it to P3.29 billion. 

Pacquiao, who is currently congressman of Sarangani, has a net worth of only P1.185 billion, according to his Statement of Assets, Liabilities and Net Worth.

The couple said “the premature seizure and liquidation of all of [their] properties” would “destroy them financially.”

It also also “forever tarnish their reputations beyond repair, even in the absence of a judicial determination rendered after the trial on the merits of the case,” they added.

Manny Pacquiao earlier cited United States Internal Revenue Service documents that he had paid $8.35 million in taxes from his fight earnings in those years.

In a 75-page memorandum, the couple asked the SC to stop the BIR from enforcing the warrant. They also asked the High Court to reverse the order of the Court of Tax Appeals (CTA) that requires them to deposit P3.2-billion cash bond or P4.9-billion surety bond to suspend the tax collection process against them.

The Pacquiaos said their right to due process was violated when the BIR proceeded in trying to collect their allegedly unpaid taxes without first serving them a Final Decision on Disputed Assessement (FDDA).

An FDDA allows the taxpayer the chance to question the bureau’s final decision.

The couple also said the CTA committed grave abuse of discretion when it ignored the BIR’s violation and ordered them to post a bond.

“Respondent Commissioner’s failure to validly and completely assess petitioners-Pacquiao couple (given the absence of an FDDA) a mandatory pre-requisite for collection clearly deprives her of authority to collect against petitioners and make all actions taken pursuant to the collection efforts of respondent Commissioner and her representatives null and void and no effect whatsoever,” the memoranda said, referring to Commission Kim Henares.

The Pacquiaos also pointed out that Henares started the collection process even before the deadline for them to pay the alleged tax deficiency lapsed. This was in violation of the requirements for summary tax collection remedies, the said.

The BIR’s letter of authority to the Pacquiaos indicated that it had establish fraud in their tax payment. The couple’s lawyer, however, told the SC that the bureau never presented proof that the Pacquiaos committed fraud their tax payments from 1995 to 2009.

They had not seen the garnishment order from the BIR either, the Pacquiaos said.

“Petitioners have been made hapless subjects of a ruthless name and shame campaign designed to strike fear in the hearts of our citizenry in the hope  that they will voluntarily pay more taxes than what is rightfully due, or risk the vengeful ire of the tax collector,” they told the High Court.

In 2014, the SC issued a restraining order on the tax court’s resolution that directed the Pacquiaos to post a cash bond or a surety bond to stop the BIR’s collection process. 

The couple said that by issuing that resolution, the tax court presumed that the BIR’s “arbitrary and bloated assessments” were correct even without hard proof being presented. 

A list of top individual taxpayers for 2015 released by the BIR shows Pacquiao on the number one spot.

– Rappler.com