MANILA, Philippines ? The seizure of Makati City?s assets by the Bureau of Internal Revenue to recover P1.1 billion in alleged unpaid taxes could cripple operations at City Hall.
Makati Mayor Jejomar Binay said yesterday utility bills would not be paid along with salaries of city employees, and basic or social services would not be met while the garnishment order is in effect.
?In short, the national government is shutting us down,? he said.
?We?re supposed to release the midterm benefits we promised our workers today. But now, we have to tell them that we don?t have the money,? Binay added.
On Wednesday, the BIR ordered 34 major banks to freeze the city government?s assets, as well as Binay?s personal funds.
In a press conference at the City Hall with Vice Mayor Ernesto Mercado yesterday, Binay questioned the serving of the garnishment order to private banks, instead of just the four government banks where the city?s assets were deposited.
?In the Philippine Veterans Bank alone, we have enough funds to cover the P1.1 billion (in unpaid taxes), so why did they serve the notice of garnishment to all banks?? Mercado asked.
?Isn?t this a clear case of political harassment?? Binay said.
But BIR revenue officer Roberto Baquiran, who signed the garnishment notices, said the ?blanket? service was standard operating procedure, since they had no way of determining the amount deposited in each bank account. ?Once we get confirmation that the P1.1 billion has been secured then, within one minute, I can order the withdrawal of the notices of garnishment,? he told the Inquirer.
The BIR alleged the city government failed to remit a total of P1,150,331,321.81 in withholding taxes of about 8,000 employees from 1999 to 2002.
On March 9, BIR chief of the withholding tax division Marivic Galban wrote a demand letter addressed to Binay, the city treasurer and the city accountant, asking the city government to pay its alleged tax liabilities. Galban gave Binay until March 31 to avail of a special ?one-time administrative abatement program.?
Binay said the issuance of the garnishment notices was irregular since BIR Revenue Memorandum Circular No. 24-2007 gave all taxpayers until June 30 to avail of the amnesty. The mayor said he would do everything necessary to regain control of Makati?s assets.
Binay, president of the United Opposition, reiterated his accusation that the BIR was acting on orders of his political enemies.
He said his political rivals knew of the BIR case several days in advance as shown by its publication in Tanod, a periodical.
Binay alleged that Tanod is run by the Genuinos. Erwin Genuino, son of Philippine Amusement and Gaming Corp. Chair Efraim Genuino, is running against Binay?s daughter Abigail for representative of the city?s district 2. Another Genuino son, Ton, is running for councilor.