Woman who supplied millions worth of coffee to Pagcor faces tax evasion case

MANILA, Philippines—The Department of Justice (DOJ) on Tuesday approved the filing of P59-million tax evasion case against the woman who sold millions worth of coffee to state-run casinos during the Arroyo administration.

In a 10-page resolution, facing two counts of violation of the National Internal Revenue Code (NIRC) was Carlota Cristi Tan for her “wilful and deliberate substantial underdeclaration of income from her dealings with the Philippine Amusement and Gaming Corporation (Pagcor) for 2003 and 2004.

Based on the complaint filed by BIR, certifications from Pagcor showed that Tan received P36.7 million for 2003 and P70.244 million for 2004 but only declared P16.064 million and P25.816 million, respectively.

“Tan’s intent to defraud is evident from her substantial underdeclaration of sales, to wit, 128.61 percent for 2003 and 172.09 percent for 2004. Considering that the underdeclaration made by respondent Tan exceeded 30 percent of the actual sales…the Task Force found that there is probable cause to believe that Tan wilfully and deliberately attempted to evade taxes in the said years,” the DoJ resolution stated.

Tan argued that she merely relied on the information of her managers and hired auditors. But the DOJ ruled that as a taxpayer and business owner, it is Tan’s duty to verify the information given to her by her employees.

“The contention raised by Tan is a meagre refutation that is best examined in a full-blown trial,” the DOJ stated in a resolution approved by Prosecutor General Claro Arellano.

Tan’s tax liability of P59 million which includes surcharges and interest was broken down as follows: P19.67 million in 2003 and P39.33 million in 2004.

In his second State of the Nation Address, President Benigno Aquino III said the P1 billion that the previous management of Pagcor had spent on coffee was one of the cases of abuse of power that his administration wanted to address.

Promolabels, which Tan is the single proprietor, cornered P700 million of the gaming firm’s P1 billion expenditure for coffee.

Tan is also a respondent in a plunder case filed by Pagcor.