BIR Files USD120m Case Against Philippine Businessman

It was reported that Bureau of Internal Revenue or BIR has filed a case against a Philippine businessman for non-payment of PHP5.5bn (USD121.4m) in taxes.

The BIR, under its Run After Tax Evaders (RATE) programme, has charged Macario Lim Gaw, Jr. wth evading the payment of correct income tax in 2007 and 2008, and for wilful failure to supply correct and accurate information in his income tax return in 2008, thereby under-declaring his income. He is also accused of wilful failure to file value-added tax (VAT) returns for the 2008 tax year.

Gow was said to have purchased property in 2007 and 2008 for a total amount of PHP4.1bn and sold it for PHP8.4bn eight months later. The BIR believes that Gaw misclassified the property sale as a sale of "capital assets", when it should have been sales of ordinary assets, and thereby paid only 6% capital gains tax rather than 32% income tax and 12% VAT due on a sale of ordinary assets.

Gaw is required to pay the BIR PHP5.5bn total of unpaid taxes, fines. Gaw is the fifth taxable BIR office to evaluate the program this year.