Nearly a year after his ouster as Chief Justice, Renato Corona is facing a P120-million tax evasion charge that could lead to his imprisonment for up to 10 years if convicted.
In a 65-page resolution dated April 26 released on Thursday, a Department of Justice panel said it had recommended the filing of the case, which allegedly stemmed from Corona’s undeclared cash and properties in six annual statements of assets, liabilities and net worth (SALNs), in the Court of Tax Appeals in Quezon City.
The panel headed by senior assistant state prosecutor Rosanne Elepano-Balauag said it found probable cause to charge Corona with violations of Sections 254 and 255 of the National Internal Revenue Code (NIRC) on tax evasion and willful failure to file income tax returns.
Violation of Section 254 is punishable by P30,000 to P100,000 in fines and imprisonment of two to four years, in addition to his liability for the tax due. Violation of Section 255, on the other hand, is punishable by a fine of not less than P10,000 and imprisonment of one to 10 years.
“Considering the evidence submitted by the Bureau of Investigation … we are inclined to believe that the documentary evidence presented by the Bureau of Internal Revenue (BIR) outweighs the bare allegations made by Corona. We note that aside from his empty claims that his other funds were merely commingled with the accounts of his other family members, etc, [he] miserably failed to substantiate the same,” the resolution said.
The BIR, following an investigation, concluded that the former Chief Justice was liable for P120,498,219.52, inclusive of surcharges and interest.
Corona, who was ousted by a 20-3 vote in the Senate on May 29, 2012, following a six-month impeachment trial, denounced the indictment.
“What fairness could I have expected from the DOJ whose head, Secretary Leila de Lima, testified against me during my sham impeachment trial? Was there ever any doubt about the outcome of this charade? My savings are a result of 45 years of diligent work in the private and public sectors. I do not owe any tax liability to the government,” he said in a statement.
“I have never in all my life ever received even a single notice of deficiency assessment from the BIR. The contrived claims of the BIR will fall flat on its face because they are without legal, factual and moral bases and are just part of the continuing political harassment and persecution that they have been incessantly inflicting on me.”
Unless Corona files a motion for reconsideration or a petition for review in the DOJ, the case against him will be filed in court.
The BIR’s investigation on Corona’s taxes was prompted by revelations made during his Senate trial. The agency alleged it found substantial increases in Corona’s net worth from 2005 to 2010 that did not appear consistent with his earnings as a public servant.
Following the unconditional waiver signed, executed and submitted by Corona to the Senate during his trial, the BIR investigated his financial holdings, particularly his real properties and bank accounts. The bureau applied the so-called “net worth method”—basically assets minus liabilities equals net worth—to show that Corona earned income from other sources aside from his compensation as a public official.
According to the BIR, Corona’s real net worth increased from P12.87 million in 2003 to P53.72 million in 2010 although he earned between P1.4 million and P4.4 million every year during the period.
In his defense, Corona said the waiver he executed was effective only until he was convicted by the Senate so all pieces of evidence collected by the BIR using the document were inadmissible in court. He said the BIR had failed to prove that the discrepancy came from the sources of income that were taxable.
Corona added that the prescription period for the filing of the criminal cases for the taxable years 2007 to 2010 had expired. He questioned the BIR’s use of the net worth method.
He maintained that there was no underdeclaration of real properties or any substantial increase in his cash assets, mainly because other people’s funds were commingled with his own. He added that the BIR had failed to take into account that he came from a “family with means and resources” and had been “gainfully employed in the public and private sectors.”
The DOJ panel rejected all of Corona’s defenses, adding some of them could be “best threshed out in a full-blown trial.”
The panel said although the net worth method was used only in civil cases, there was nothing in the NIRC that prohibited the BIR from using this in criminal proceedings.
The prosecutors pointed out that Corona signed the waiver as a depositor not by virtue of his public office. The waiver also did not state that it was only for the purpose of the impeachment proceedings.
By the time Corona signified his intention to withdraw the waiver in his June 11, 2012, letter to Banco de Oro and his Oct. 10, 2012, cease-and-desist letters to other banks, the banks had already complied with the BIR’s demand for access to Corona’s accounts.
With the withdrawal of the waiver, the BIR could no longer further inquire into Corona’s accounts and in effect blocked the agency from verifying his defenses.
The panel also junked Corona’s claims of prescription. This prescriptive period does not begin to run until the crime is discovered and judicial proceedings have been instituted, the panel said.
The prosecutors said Corona could not claim that the BIR had failed to take into account his family’s and personal wealth in computing his net worth, adding that the agency could not be faulted for relying on his SALNs.
“It should be highlighted that respondent Corona swore under oath that the information contained in his SALN is true and correct statements of his assets, liabilities, net worth and business interests,” they said.
As to his claim that the money in his bank accounts belonged to other persons, the prosecutors pointed out that Corona failed to produce a single affidavit to support this.
The panel said there was a “consistent pattern” of underreporting large amounts of income and noninclusion of all his income and properties in his SALNs.
“The evidence they (BIR) obtained, so to speak, was not culled out of thin air,” it said.