Manny Pacquiao Appeal on BIR Php 2 Billion Tax Case

Manny Pacquiao won his last fight just recently against Brandon BamBam Rios, and he dedicated this fight for the victims of typhoon Yolanda/Haiyan. As he came back here in the Philippines, he immediately do something about helping the typhoon victims. To his dismay, the BIR has frozen all his bank accounts. He ask his friends for monetary help just to make his promise on helping the Yolanda victims.

Manny Pacquiao and his wife, Vice Gov. Jinkee, have appealed the tax fraud case filed by the Bureau of Internal Revenue (BIR) against them for alleged tax deficiencies in 2008 and 2009 amounting to P2.2 billion.

Last Thursday, November 21, through his lawyers, Pacquiao filed a petition against BIR commissioner Kim Henares before the Court of Tax Appeals in Quezon City.

In the petition, Pacquiao said he wants to stop the BIR from collecting the P2.2 billion in supposed tax deficiencies.

Pacquiao called on the Court of Tax Appeals to declare the BIR’s formal letter or demand and final assessment notices “null and void.”

The bureau had placed the Pacquiao couple under a fraud investigation as early as 2010 in line with its Run After Tax Evaders (RATE) program.

But Pacquiao’s lawyers disputed the BIR’s allegations, stressing that Philippine laws guarantee the petitioners’ protection against double taxation.

Pacquiao’s camp also wants to cancel the assessments for deficiency in income tax for 2008 and 2009 in the aggregate amount of P2,229,020,905.50 for having been issued without factual and legal basis.

Technical issues were also raised by petitioners regarding the manner by which the demand letters were sent.

The petition read as “In sum, the present dispute centers on an attempt on the part of the respondent to collect taxes on petitioner’s US-sourced income and the refusal of the petitioner to be taxed twice, by both the US and Philippine governments, on the same income”.

“The issuance of the deficiency income tax assessment on petitioner’s US-sourced income is in direct contradiction to respondent’s previous pronouncements on the matter,” the petition said.

Pacquiao’s camp quoted Henares’ earlier statement that “a Filipino citizen is taxed on his global income.”

His lawyers said this runs contrary to another pronouncement of Henares that the BIR is going after Pacquiao for his Philippine-sourced income.

The lawyers further argued that Pacquiao’s income from Philippine sources is not in dispute as the gross income from local endorsements based on findings of the BIR’s National Investigation Division had already been admitted by petitioners.

“Insofar as the petitioners’ Philippine income tax liabilities are concerned, respondent should have considered this case closed at the administrative level,” the petition said.

Pacquiao contradicted Henares who “insists on collecting Philippine income tax” against him in connection with his five boxing matches held in Las Vegas, Nevada.

The lawyers said Pacquiao “already paid income tax in the US totaling to $8,414,531 (or approximately P395,500,000).

Pacquiao’s legal team also argued that Henares’ stance is “inconsistent” with the provisions of the Philippines-US Tax Treaty, specifically Article 17 where it is imputed that Pacquiao’s income from boxing matches held in the US is “taxable in the United States.”

To defend his tax fraud case, Pacquiao hired topnotch lawyers from the Romulo, Mabanta, Buenaventura, Sayoc and De los Angeles.

Just a while ago, Manny Pacquiao held a press conference and according to him, "Inihabla po ako ng BIR ng P2.2 B tax case na wala pong basehan. Umutang po ako ng pera upang makatulong sa mga nasalanta ng bagyo dahil ginarnish ng BIR ang aking bank accounts. Inutusan ko na po ang aking mga abogado na gawin ang lahat upang ma-lift ito upang ako ay makatulong. Nakikiusap po ako sa BIR na alisin na ang garnishment sa aking accounts at properties." He added, "Huwag po sana akong i-single out at personalin dahil hindi po ako magnanakaw."

There’s so much to do in this country rather than this… The government has their reasons but, their putting our lives in jeopardy…

Cheerio!