MANILA, Philippines?The owners of Club Manila East, a resort in Taytay, Rizal, were charged with tax evasion Thursday for failing to file accurate income tax returns for more than a decade.

The Bureau of Internal Revenue (BIR) also accused spouses Julio and Priscilla Cruz, of Barangay San Juan, Taytay, Rizal, of not submitting proof of the source of the ?substantial? income they earned over the past 13 years.

BIR Commissioner Kim Henares said at a press conference at the Department of Justice (DoJ) that the couple would be made to pay income taxes amounting to P854.9 million.

The BIR filed the tax evasion charges against the couple in the DoJ, the seventh case to be filed under the agency?s Run After Tax Evaders (RATE) program of the Aquino administration.

Warning

?This case serves as a warning against the common practice of [businessmen] with very rich companies and yet the owners don?t file [their] income tax returns,? Finance Secretary Cesar Purisima said.

The BIR described Club Manila East as a ?seven-hectare business and recreational zone? with branches in Boracay and Real, Quezon.

The BIR also filed tax evasion charges against Marieandy Fricke of Ayala Alabang Village, Muntinlupa City, and spouses Melito and Malisa Chua.

The BIR said Fricke and the Chuas committed the ?brazen and deceitful act? of transferring a land title using a fake or falsified certificate authorizing registration and tax clearance certificate which were allegedly issued by the BIR.

By doing so, the three were able to evade the payment of the capital gains tax and documentary stamp tax.

Fricke and the Chuas owe the government a total of P7.45 million in deficiency taxes, including surcharge and interests, according to the BIR.

P783-M unreported income

The BIR said the Cruz couple filed an income tax return only for the P9.6 million in compensation they earned since 1999.

However, a BIR audit showed that the Cruzes had a total of P783.3 million in unreported income in the form of cash investments in two corporations from 1992 to 2004.

These were Manila East Holdings Corp. (Mehco) and JS Cruz Construction and Development Corp. (Cruzcon) in which the couple were both majority stockholders.

Paid up capital stocks, cash advances, and cash deposits for future subscriptions made up the investments of the Cruzes, according to the BIR.

The BIR has served the Cruzes several assessment notices.

Personal loans

In response, the couple admitted that they had substantial cash investments but explained that these came from personal loans advanced by Julio Cruz, personal loans he secured from private outside sources, and their accumulated savings.

?The spouses, however, miserably failed to present documents to substantiate their claims that the said cash amounts infused in two corporations were indeed personal loans,? the BIR said in a statement.

The agency said the investments were considered ?unreported income? for which the Cruzes were liable to pay deficiency income taxes for the taxable years.

Deed of absolute sale

In the other case, the BIR said Fricke, of Ayala Alabang, Muntinlupa, owed the government P5.95 million and the Chuas, with address in Deparo, Caloocan City, had a tax liability of P1.49 million.

?The respective liabilities of Fricke and spouses Chua were based on their agreement as contained in the deed of absolute sale to which they were the signatories,? the BIR said in a statement.

Greenhills property

A BIR investigation showed that Fricke and the Chuas were parties to a transaction that involved the sale of a 1,209-square meter property, including its improvements, at Albany corner Nevada streets in Greenhills, San Juan.

The parties were able to effect the transfer of title to the property with the register of deeds in San Juan.

However, BIR investigators discovered that aside from not paying the capital gains tax and the documentary stamp tax, the parties also showed the register of deeds a falsified CAR and tax clearance certificate.

The case against Fricke and the Chuas was the sixth tax evasion case filed by the BIR under its RATE program.

Villarica

The first case was filed on July 15 against pawnshop owner William R. Villarica, who declared zero income in the same year he acquired a P26-million Lamborghini sports car.

On July 29, the BIR filed a tax evasion case against Dennis S. Masigan and his wife Natalie, president and corporate secretary of DSM Construction & Development Corp. (DSM), as well as DSM vice president for operations Eldrin M. Masigan.

On Aug. 12, the bureau filed tax evasion cases against China State Philippines Construction Engineering Corp. (China Philippines) and local printing company Grand C Graphics Inc.

On Aug. 26, the BIR filed a complaint against Macario Lim Gaw, owner of Mega Packaging Corp.