MANILA, Philippines – A separate tax case was filed before the Pasig Regional Trial Court (RTC) against Rappler Holdings Corporation and Maria Ressa, adding to the list of charges also pending at the Court of Tax Appeals.
The Department of Justice (DOJ) filed 4 tax cases before the CTA on November 26 and 28, but Rappler’s lawyers discovered on Thursday, November 29, that a 5th case was separately filed before the Pasig RTC.
The charges were filed at the Pasig court on November 14. This happened a day before the DOJ decided to serve a copy of the indictment on Rappler’s counsels.
The separate case means that two courts can now issue a warrant of arrest against Ressa, who received two major awards from international groups just this month. (WATCH: Maria Ressa receives Knight International Journalism Award)
The case at Pasig RTC is for alleged violation of Section 255 of the Tax Code, related to Rappler’s supposed failure to supply correct information in its Value Added Tax (VAT) return for the 2nd quarter of the tax year 2015.
The DOJ accused Rappler of earning taxable income worth P2.45 million ($46, 693) for that period, and therefore “resulting in deficiency value added tax in the amount of P294,258 ($5,608), exclusive of surcharge and interest, to the damage and prejudice of the government.”
Ressa described it as a desperate move aimed at silencing independent voices. (READ: The Rappler story)
“We continue to tell the story of the nation,” Ressa said. “These cases will not intimidate nor distract us from holding public officials to account through our stories.” (WATCH: Maria Ressa receives International Press Freedom Award)
A provision in the CTA’s law says that the tax court must have original jurisdiction for all cases under the tax code “provided however that..the principal amount exclusive of charges and penalties claimed is less than one million.”
The DOJ has recommended a bail of P60,000 ($1,145). Charges in the CTA have recommended bail at P240,000 (about $4,000). The two courts would now proceed to assess if there is probable cause to issue a warrant of arrest.
The charge stem from Rappler’s Philippine Depositary Receipts (PDRs), a mechanism with which Filipino companies can have foreign investments. Rappler issued PDRs to foreign investor Omidyar.
The PDRs were the basis of the Securities and Exchange Commission’s (SEC) order last January revoking Rappler’s license, an order that the Court of Appeals did not uphold.
In its ruling in July, the Court of Appeals (CA) said that the defect had been cured when Omidyar donated the PDRs to Rappler’s Filipino managers. It remanded the case back to SEC for review. (READ: Business as usual for Rappler, CA urges review of shutdown order)
Justice Secretary Menardo Guevarra has said the filing of an appeal by Rappler does not preclude the DOJ from going ahead and filing the charges in court. Rappler has filed a motion for reconsideration before the justice department.
The DOJ said issuing PDRs made Rappler a dealer of securities. Rappler’s chief counsel Francis Lim dismissed this, saying it has no legal leg to stand on.
Lim had earlier pointed out that network giants GMA and ABS-CBN have similar PDRs with similar agreements as Rappler’s, which the government has not at all investigated.