The Department of Justice (DOJ) has recommended the filing of tax evasion charges against one of the lawyers of Andal Ampatuan Jr., the main suspect in the Maguindanao massacre, for underdeclaring his taxable income for 2011.
Prosecutor General Claro Arellano recommended the filing of charges against lawyer Arnel Cortez Manoloto after it was discovered that he did not declare his purchase for P20 million of eight pieces of property belonging to Ampatuan in January 2011—just two weeks before the court ordered a freeze order on all assets owned by all those accused in the massacre in 2009 of 58 people, including 32 journalists in Maguindanao.
Also charged was Manoloto’s accountant, Erwin Carreon, who had certified that all the information on Manoloto’s 2011 tax declaration was “true and fair.”
Cortez will be charged of violating the National Internal Revenue Code, specifically Sections 254 (attempt to evade or defeat tax), 255 (failure to supply correct and accurate information in his income tax returns [ITRs] and failure to file value-added tax [VAT] returns for taxable year 2011) and 275 (failure to register for VAT).
Carreon, on the hand, will be charged of violating Section 257 or making false entries, records or reports, or using falsified or false accountable forms.
A complaint filed by the Bureau of Internal Revenue (BIR) against Manoloto and Carreon before the DOJ was initially dismissed by Assistant State Prosecutor Ma. Cristina Barot who conducted a preliminary investigation.
But Barot’s dismissal was disapproved by Arellano who issued the 11-page review resolution recommending the charges against Manoloto and Carreon.
The BIR filed the tax evasion case against Manoloto in November last year. Internal Revenue chief Kim Henares said the BIR began probing Manoloto after a Philippine Center for Investigative Journalism report exposed how Ampatuan transferred ownership of eight properties in Davao City to Manoloto just two weeks before the Court of Appeals issued a freeze order on all the assets owned by the accused in the massacre.
In his review resolution, Arellano pointed out that Manoloto declared a taxable income of only P1,495,200 for taxable year 2011, but the BIR had found out he bought eight parcels of land in Davao City in Jan. 17, 2011, for P20 million. The agency also discovered that Manoloto had a deferred revenue in the amount of P17,501,500 as reflected in a financial statement attached to his ITR.
“(Those) amounts should have been declared as part of his taxable income for 2011,” said Arellano, also noting that Carreon certified that the financial statements of Manoloto “gave a true and fair view” of his client’s financial status.
Arellano said there was prima facie evidence of a fraudulent return because Manoloto’s unreported income constituted a substantial underdeclaration of more than 30 percent.
In his defense, Manoloto explained that the P20 million he used to buy the eight parcels of land came from personal loans and friends.
But Arellano noted the BIR was able to establish that the supposed creditor in one of the promissory notes signed by the lawyer was actually out of the country on the date of her supposed personal appearance before the notary, thus, casting doubt on the authenticity of the promissory notes.
Arellano also took note of the BIR’s finding that the entries in the ITR and financial statements of the lawyer were “manipulated to make it appear that his taxable income for 2011 was only P1,495,200 (when the true and accurate income was P37,967,266.26).” Christine O. Avendaño