Tax Evasion Cases on Two Sole Proprietors in Construction Business

By: Garry S. Pagaspas

The Philippines’ Bureau of Internal Revenue (BIR) has filed new tax evasion charges last August 16, 2012 under its Run After tax Evader (RATE) program against two (2) sole proprietors engaged in construction business as follows:

•  The Sole Proprietor of Hoksing Builders (HB)

• Sole Proprietor of Togado Builders (TB)

TB, owned and operated by a licensed Architect, is charged for gross under declaration of income by at least P12M, and his alleged estimated aggregate income tax and VAT liability from 2007 to 2009 is P12.2M.

As of the above filings, BIR reported its filed cases under RATE to be 121.

Comments:
We just wish to note that in tax evasion cases, the prescriptive period is ten (10) years from date of discovery of alleged fraud or when no return is filed. This may explain why the above involves 2006 and 2007 taxable years.
The case itself may not be conclusive of tax evasion and as a case criminal in nature, the  taxpayers involved above are still entitled due process in the prosecution. If they could prove the charges are baseless, then, the case will not succeed.
Of course, it would be better to avoid being charged by complying with the tax rules and regulations. As it says, prevention is better than cure. Please note that our tax system in the Philippines is on voluntary compliance. What to comply, when to comply, and where to comply is for the taxpayer to learn, and failure to comply may subject taxpayers with penalty.
Reference:

•  Vol. 3 Issue No. 33 of BIR Weekender Reliefs for Week Ending August 17, 2012

Disclaimer: This article is for general conceptual guidance only and is not a substitute for an expert opinion. Please consult your preferred tax and/or legal consultant for the specific details applicable to your circumstances. For comments, you may also please send mail at info(@)taxacctgcenter.ph, or you may post a question at Tax and Accounting Center Forum and participate therein.

See our quality seminars, workshops, and trainings…

See how we can help you with our other professional services : company registrations; Ph Working Visa; and HR Services

Get to know more about us…

Read More Articles…