BIR files P73.85-million tax evasion raps vs. Mikey, wife

UPDATED 2:00 p.m. — The Bureau of Internal Revenue (BIR) on Thursday filed with the Department of Justice (DOJ) a tax evasion complaint against "Ang Galing Pinoy" party-list Rep. Juan Miguel "Mikey" Arroyo and his wife Angela. The BIR is now requiring the couple to pay P73.85 million in aggregate tax liabilities accumulated from 2004 to 2009. Below is the BIR's computation of the couple's tax liabilities arising from their alleged non-filing of income tax returns and underdeclaration of income. The amount stems from their "repeated willful [failure] to file their income tax returns and substantial underdeclaration of income of the periods in question," BIR commissioner Kim Jacinto-Henares said at a news briefing at the DOJ office in Manila. Section 254 of the Tax Code requires the filing of income tax returns while Secton 255 of the same code requires the payment of taxes. The bureau said that a scrutiny of Mikey's Statements of Assets and Liabilities and Networth (SALN) from 2002 to 2009 would show that from 2004 to 2009, the lawmaker and his wife bought millions-worth of properties, including houses, vehicles, and shares of stock. However, the BIR noted: "Despite receipt of substantial amounts of income, the Arroyo spouses repeatedly failed to file any annual income tax return (ITR) and to pay the corresponding taxes due thereon." The bureau alleged that Mikey did not file his ITR in 2005, 2008, and 2009. In 2004, he declared a net income of only P2.4 million, in 2006 he declared P1.7 million net income, and in 2007, the Mikey reported a P376,000 net income. The BIR added that Angela declared as a one-time taxpayer in 2004. "It means she was selling a property or shares of stocks in a non-listed company. So there's a capital gains tax she was paying. She did not report any income," said Henares. "They claim they have all these assets but no ITR has ever been reported by Angela Montenegro Arroyo," Henares added. Mikey cries harassment Shortly after being informed of the tax evasion complaint lodged against him and his wife, Mikey questioned what he called a lack of due process in the BIR's handling of the case. While Mikey, son of former President Gloria Macapagal-Arroyo, insisted that his conscience was clear because he had paid his taxes, he said the BIR informed him of his supposed tax deficiencies only last Tuesday, the 64th birthday of his mother, the former President. "If they don't want to respect due process, and [want] to harass me.... I respect that. There's nothing to worry about," he said in an interview on dzBB radio. Meanwhile, in an interview with GMA News' Balitanghali the younger Arroyo said the BIR and the DOJ seemed to be so in a hurry to file the tax evasion case so much so that they did not wait for the 10 days given to him under the law to respond to the notice. "I've nothing against the government reviewing citizens who they see are remiss in paying taxes. What I am wondering is the lack of due process ... I'll talk to my lawyers," he added. He said the records of his properties are in his SALN. Arroyo said his income tax returns (ITRs) are available at the House of Representatives. He said these are "public record." However, he contested the BIR's claim that his wife Angela had no ITRs, saying she was not employed. "Our lawyer will just answer this pero wala siyang trabaho (Our lawyer will answer this but offhand I can say my wife is not employed)," he said in the interview on dzBB. "My conscience is clear, I pay my taxes. Everything I own is in my SALN, public record. So let's leave it at that. If they have issues, talk to my lawyer," he added. Asked on Balitanghali if he still intends to file his response, he said, "Hindi na siguro kailangan" (may be there is no more need for that). But I'll talk to my lawyer about it." BIR and DOJ assure due process At the news briefing at the DOJ, Henares stressed that the complaint was not railroaded to harass Mikey. "If the argument is that we are singling out anyone and not based on evidence, then shouldn't we have filed this case long ago? We file cases based on evidence. It's not because of any personality," said Henares. For her part, Justice Sec. Leila de Lima said that the DOJ will give the lawmaker due process. Asked whether the DOJ's preliminary investigation may lead to the filing of other charges against a public official like Mikey, De Lima replied that they will do "the necessary evaluation" whether Mikey has also violated the Anti-Graft and Corrupt Practices Act. – VVP/LBG, GMA News