Philippine Medical Association President Dr. Leo Olarte. INQUIRER PHOTO/NIÑO JESUS ORBETA
The former president of the Philippine Medical Association (PMA) who once publicly criticized the Bureau of Internal Revenue (BIR) for its print advertisement which depicted a doctor as a tax cheat has been charged with not paying over P1.35 million in taxes.
Based on a complaint filed by the BIR last year, the Department of Justice (DOJ) on Wednesday indicted Dr. Leo Olarte over his tax deficiency and for his failure to file his income tax returns (ITRs) for seven years—from 2006 to 2012.
But at the same time, Assistant State Prosecutor Stewart Allan Mariano cleared Olarte of the charge of nonpayment of value-added taxes (VAT) during the same period, saying the BIR failed to back this up with evidence.
In the DOJ resolution released Wednesday afternoon, Mariano noted that Olarte “never was able to disprove [the] BIR’s allegation that he did not file his income tax returns [between 2006 and 2012].”
“Notwithstanding the fact that respondent’s compensation and income was indubitably taxed on account of the taxes withheld which BIR failed to impugn, the former cannot escape criminal liability arising from his failure to file his income tax returns for the said period,” he said.
Mariano recommended that Olarte be charged in court for seven counts of violating Section No. 255 of the National Internal Revenue Code which penalizes those who fail to pay the correct amount of taxes, file their ITRs and supply correct and accurate information about their tax payments.
He noted that the doctor had incurred a tax deficiency of over P1.35 million between 2006 and 2012.
“Such failure to file income tax returns from 2006 to 2012 inclusive, albeit the taxes withheld therefrom by his employers, constitutes existence of probable cause,” Mariano said.
But he pointed out that contrary to the BIR’s allegations, Olarte could not be faulted for nonpayment of VAT during the same period since he paid P743,563 in value-added tax.
Olarte landed in the news in March last year when, as PMA president, he cried foul over a BIR newspaper which criticized doctors who failed to pay the correct amount of taxes.
The half-page ad, showing a woman doctor riding piggyback on a female teacher, carried the message: “When you don’t pay your taxes, you’re a burden to those who do. Do your share. knowyourtaxes.ph.”
Olarte said the print ad came as a surprise as it was not discussed in the PMA’s various consultations with the BIR over the agency’s campaign against doctors who were not correctly paying their taxes.
That same month, the BIR filed a complaint against Olarte in the DOJ, accusing him of several counts of willful attempt to evade or defeat payment of income tax and VAT. It also claimed that he deliberately failed to file his annual ITRs and VAT returns.
But Olarte, who is also a lawyer, had said then that he merely resorted to “tax avoidance” which he stressed was legal.
He again landed in the news when on March 16 last year, then Professional Regulatory Commission (PRC) Chair Teresita Manzala said that he and his four predecessors at the PMA had been slapped with an ethics case in the PRC for allegedly forging her signature in the endorsement papers submitted to the Securities and Exchange Commission (SEC) for the registration of the Philippine Society for Stem Cell Medicine (PSSCM).
Olarte, one of the PSSCM incorporators, denied the allegation, saying they had hired a firm to register the society’s with the SEC.
He also questioned the timing of Manzala’s disclosure as it coincided with the PMA’s general election where he was running for reelection. Olarte later lost to Dr. Minerva Calimag.–With Inquirer Research