Tax court asked to bar trader from leaving

The Office of the State Prosecutor has asked the Court of Tax Appeals to issue a hold-departure order against businessman Macario Gaw Jr., who is facing charges of cheating the government of at least P2.3 billion in taxes.

The Bureau of Internal Revenue’s (BIR) tax evasion suit against Gaw is the biggest so far at P5.5 billion, including penalties, surcharges and interest on top of the unpaid taxes.

Gaw is the owner of the taxi fleet MGE Transit Corp. and president of Megapacking Corp. and Macro Liquid Petroleum Gas Co. Inc.

Senior State Prosecutor Susan F. Dacanay told the court Gaw should not be allowed to leave the country especially because he was liable to a jail term of up to 10 years and a fine of at least P10,000.

‘Vast resources’

“Considering the gravity and magnitude of the offense committed… as well as the imposable penalty which involves imprisonment, not to mention that he has vast resources, there is real danger that accused will flee the country to avoid criminal liability,” Dacanay said.

Based on the BIR assessment, Gaw owes the government P1.01 billion in value-added tax (VAT) and P1.32 billion in income tax.

According to the BIR, Gaw under-declared his income in 2007 and 2008, failed to file VAT returns for 2008 and failed to report to the revenue agency correct data and information regarding his tax liabilities.

Gaw allegedly bought 10 parcels of land in 2007 and 2008 for a total of P4.11 billion and sold them for P8.41 billion within a year.

Also, Gaw allegedly paid only a 6 percent capital gains tax and avoided paying the 32 percent income tax and the 12 percent VAT when he “misclassified” the sale as a capital asset instead of ordinary assets.

Probable cause

The justice department ruled last April that there was probable cause to put the businessman on trial. This led to the filing of the cases against Gaw with the appeals court.

In a resolution issued Oct. 19, the court’s first division ordered Gaw’s arrest after finding probable cause, and set the bail at P120,000 for each of the two cases.