The Bureau of Internal Revenue (BIR) has come up with a figure for Sen. Emmanuel D. Pacquiao to think about—P1 billion in settlement if he chooses to have a compromise deal for his P2.26-billion tax-deficiency collection case now pending with the Court of Tax Appeals (CTA).
BIR Deputy Commissioner for Legal Affairs Clint Aranas told the BusinessMirror that the BIR’s current policy in pending tax-evasion and collection cases is to continue to prosecute the offenders and go after their tax liabilities.
But Aranas said those that can still be settled through a compromise deal may be pursued in such manner, subject to the procedures in the Tax Code, since it is easier to collect the tax deficiencies through this process.
“We will not relent on tax-evasion and collection cases which are pending,” Aranas said.
“But for those cases which can be subject to a compromise, then we’re open to that. If they’re going to pay us P1 billion, then we’ll accept that. It will all be aboveboard, and the government will give them a receipt [for the payment],” he added, when asked whether the spouses Pacquiao have sought to settle their pending tax-deficiency case.
On Monday night Pacquiao, who is now a member of the ruling party PDP-Laban, was scheduled to meet President Duterte in Malacañang, although the agenda of the meeting was not disclosed.
Aranas said a taxpayer facing a collection case filed by the BIR may file an application for a compromise on his alleged tax deficiency, subject to approval by the evaluation board composed of the commissioner of the BIR and the four deputy commissioners, if the basic tax deficiency involved exceeds P1 million. Aranas said Pacquiao’s tax-collection case still falls within the power of the BIR commissioner to compromise.
Under Section 204 of the National Internal Revenue Code (NIRC), the BIR commissioner may compromise the payment of any internal revenue tax when: “a reasonable doubt as to the validity of the claim against the taxpayer exists; or the financial position of the taxpayer demonstrates a clear inability to pay the assessed tax.”
Pacquiao would fall within the first category of cases which can be compromised, wherein the compromise payment will have to be at least 40 percent of the alleged basic tax deficiency of P2.26 billion.