WHAT WENT BEFORE: BIR files complaint vs Pacquiao

The Bureau of Internal Revenue (BIR) filed a complaint against Manny Pacquiao in March 2012 for his alleged failure to submit complete tax records for 2010.

The BIR started to investigate Pacquiao in late 2010 and was late until early 2011 after an “abrupt” drop in his ranking among the country’s top taxpayers.

From 2006 to 2008, the boxing great was in the top 10 percent of highest taxpayers, even topping the 500 Individual Taxpayers List in 2008, but he slid to the top 30 percent in 2009.

As the BIR’s poster boy then, Pacquiao was tapped in March 2009 to do a 30-second television commercial reminding people to pay their taxes.

When the BIR audited him for his 2008 and 2009 income tax returns (ITRs), Pacquiao did not submit any documents, prompting the agency to subpoena him.

He responded by executing an affidavit declaring his US income and tax payment in his 2008 ITR but without any supporting documents.

Regarding his 2009 ITR, the BIR said Pacquiao did not declare any US income but only less than P50 million earned in the Philippines, thus the “underdeclaration.” His alleged tax liability was P2.2 billion.

On July 25, 2013, Pacquiao filed a petition in the Court of Tax Appeals (CTA) seeking a review of the BIR’s P2.2-billion assessment of his and his wife’s tax liabilities.

In November 2013, the BIR froze Pacquiao’s bank accounts for his refusal to pay his tax bill related to earnings in the ring in 2008 and 2009.

The boxer said he had already paid the required taxes in the United States and that paying in the Philippines would equate to double taxation.

In August 2014, the Supreme Court issued a temporary restraining order stopping the CTA from requiring Pacquiao and his wife, Jinkee, to post a cash bond of P3.29 billion or a surety bond of P4.9 billion in exchange for the suspension of the collection of alleged tax deficiencies in 2008 and 2009.

The bond included the accumulated surcharges and penalties, according to the BIR.

In October 2015, the Pacquiao couple reiterated their plea for the high court to stop the BIR claims and the CTA requirement for bonds to suspend the collection of P2.2 billion in supposed unpaid taxes. —INQUIRER RESEARCH

SOURCE: INQUIRER ARCHIVES